Public utility districts seek access to captive insurance; committee hears House Bill 1842

Supporters of House Bill 1842 told the Environment & Energy Committee that authorizing public utility districts (PUDs) to form or use captive insurance companies can help districts manage insurance risks and obtain coverage not otherwise available.

Matt Sterling, committee staff, explained that the bill would allow local government entities and public utility districts to form, own or participate in captive insurance companies—private insurers created by their policyholder-owners to insure risks of those owners. Ron Gibbs, manager of insurance and risk management for Chelan County PUD, said premiums have increased sharply in recent years and that captive insurance is a tool PUDs use to access coverage. "Our premiums have gone up over 400% since 2019 despite the fact that we've never had an insured event," Gibbs said, and he asked the committee to "grant PUDs the same access to captive insurance as these other organizations."

Ryan Smolinski, staff attorney for Chelan County, described the bill's drafting as technical and limited in scope: it would add specific statutory language to chapters governing local government insurance transactions and captive insurance and make small, targeted changes to the Public Utility District Act. Committee members heard no opposition testimony and no further questions; the committee closed the hearing on the bill for now and did not take a vote.