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Lawmakers back bill letting Minnesota Insurance Guarantee Association deem non‑responsive insureds as over the $25 million net‑worth threshold
Summary
Senate File 1758 would allow the Minnesota Insurance Guarantee Association to treat insureds who fail to return a net‑worth affidavit within 60 days as exceeding the $25 million threshold that disqualifies claim coverage, to speed claims processing after an insurer insolvency. The committee recommended the bill to general orders.
Senate File 1758, introduced by Sen. Lee Dames, would modify procedures for the Minnesota Insurance Guarantee Association (MIGA) to determine whether claimants are covered when an insurer is liquidated. Specifically, the bill would permit MIGA to treat an insured who does not return a requested net‑worth affidavit within 60 days as meeting the $25 million net‑worth threshold that excludes coverage.
Jeff Christiansen, executive director of MIGA, told the Commerce Committee that the association currently receives only about 10% of the requested net‑worth responses and that the lack of information creates delays and the risk of paying claims that are not covered under state law. The proposed affidavit process would create an incentive to respond and allow MIGA to move claims through the statutory process more quickly.
Christiansen said the goal is to speed claim resolution, avoid paying ineligible claims and reduce delays in compensating injured policyholders. The Department of Commerce reviewed the proposal and raised no concerns, Christiansen said.
The committee voted to recommend Senate File 1758 to general orders; the motion to pass was adopted by voice vote.
