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Committee advances bill letting state‑chartered credit unions opt into private deposit insurance
Summary
House File 4118 would allow state‑chartered credit unions to opt into private deposit insurance (maintaining $250,000 coverage) as an alternative to federal NCUA insurance; proponents said the option protects members if federal governance is disrupted and would remain subject to state supervision; the committee referred the bill to Ways and Means.
Representative Kotyza‑Witthuhn introduced House File 4118 on March 11 to allow Minnesota credit unions to opt into privately provided deposit insurance as an alternative to federal National Credit Union Administration (NCUA) insurance. Sponsors framed the bill as a contingency measure in light of federal governance uncertainties and said credit unions would remain supervised by state regulators.
Ryan Smith of the Minnesota Credit Union Network said private insurance can provide equivalent or enhanced coverage (the private model can be structured to guarantee $250,000 per account similar to FDIC levels) and that the Department of Commerce worked with proponents on bill language. Brent Randy, president and CEO of First Alliance Credit Union, said private insurance is an additional option that would not reduce oversight; he said any move would be made in coordination with the regulator.
Kurt Lows (American Sure Insurance), testifying by remote connection, described the private insurance model and the fund’s auditing and actuarial practices. Proponents said several other states have comparable options and that the bill would preserve member protections while adding an alternative. The committee referred HF 4118 to Ways and Means by voice vote.
