Subcommittee debates moving municipal risk pools to insurance regulation amid solvency and disclosure concerns

The Commerce and Consumer Affairs subcommittee on Senate Bill 297 spent a lengthy session weighing whether pooled public-entity risk programs — municipal and school “risk pools” — should be regulated under an insurance licensure model rather than the Secretary of State’s statutory model.

The question before members was whether an amendment (referred to in session as the Carson amendment) that places pooled risk-management programs under the Department of Insurance and subjects them to licensure, reporting and solvency rules should replace the Senate version of SB 297. The hearing drew officials from risk pools, Department of Insurance staff and municipal officials.

The issue matters because the bill would change who enforces financial and consumer protections for programs that provide health and other benefits to towns, schools and counties. Those programs manage taxpayer dollars and, if undercapitalized, can produce midyear assessments that local budgets cannot easily absorb.

Department of SchoolCare executive director Lisa Duquette told the panel she was concerned the amendment’s language “seems to allow commingling of public entity risk funds,” citing past problems when different program funds were subsidized from other lines. Duquette also raised licensing and producer‑license language that, she said, could require individuals who merely provide information to be treated like insurance producers: “It seems…we would need to go through…