All Roll Calls
Yes: 106 • No: 0
Rhode IslandH55482025 Regular SessionHouseWALLET
AN ACT RELATING TO INSURANCE -- VOLUNTARY RESTRUCTURING OF SOLVENT INSURERS .
Sponsored By: Brian Patrick Kennedy (Democratic)
Signed by Governor
Personalized for You
How does this bill affect your finances?
Personalize government policy and PRIA will tell you what this bill means for your household, plus every other piece of legislation we track. PRIA reads each provision against your financial profile to show you exactly what matters to your wallet.
Bill Overview
Analyzed Economic Effects
6 provisions identified: 3 benefits, 1 costs, 2 mixed.
Property claims get $1 million backstop
For insurer insolvencies after January 1, 2026, Rhode Island’s insurance guaranty association provides up to $1 million for covered property losses. This applies to claims for the policyholder’s own losses under residential or commercial property policies. The limit covers all claims from one occurrence together, not each claim or claimant separately. Payments cannot exceed the policy’s limit.
Wealthy policyholders lose insurance backstop protection
Rhode Island’s insurance guaranty association need not pay claims for a policyholder’s own losses when consolidated net worth exceeds $50 million. Net worth includes subsidiaries and affiliates, measured on December 31 before the year the insurer became insolvent. State and local governments are exempt. The association may recover payments already made for these insureds. It may choose to pay covered cyber obligations, but must recover those payments, claim-handling expenses, attorneys’ fees, and court costs. Refusing to provide requested, available financial records allows provisional denial as a high-net-worth insured. In court, the insured then must prove its net worth and risks paying costs if it cannot. Another exclusion applies when the claimant’s home-state guaranty association denies coverage under that state’s higher net-worth limit.
Transferred policies gain insurance backstop access
Some transferred insurance obligations now qualify for Rhode Island guaranty association protection after the receiving insurer fails. For policies originally issued by a member insurer, that insurer must have no remaining policy obligations. The receiving insurer must face a final liquidation order finding insolvency; transfers to non-members require prior regulatory or court approval. The claim must otherwise qualify using the same claim-submission and liquidation dates as if no transfer had occurred. Obligations originally held by non-members can also qualify after becoming a member insurer’s sole direct obligation before its insolvency. Those transfers must use a merger, approved assumption reinsurance, or a plan approved by the member’s home-state regulator. The association can also choose and direct covered-service providers and lawyers defending covered liability claims.
Cyber claims gain protection with limits
Qualifying cyber insurance claims gain access to Rhode Island’s insurance guaranty association when an insurer becomes insolvent. The warranty and service-contract exclusion does not bar coverage included in a qualifying cybersecurity policy. Coverage must be written directly by a state-authorized insurer and cover specified cyber losses or loss prevention. The association’s payments are capped at $500,000 for one insured event under a cyber policy or endorsement. That cap combines policyholders’ own claims and claims against them, regardless of how many claims or claimants there are.
Workers’ compensation insurers gain restructuring access
Qualifying Rhode Island commercial run-off insurers can include workers’ compensation business, which was previously excluded. This expands access to the law’s voluntary restructuring framework. Life and personal-lines insurance remain excluded. For a Rhode Island domestic company receiving commercial liabilities, those liabilities cannot exceed the transferred assets.
Insurance exchanges get new financial safeguards
Beginning January 1, 2026, Rhode Island replaces its rules for reciprocal insurance exchanges, whose subscribers share insurance risks. Exchanges need annually renewed authorization, financial reports, examinations, and required reserves; their managing representatives must maintain a Rhode Island office. Reinsurance reserves must equal either 50% of qualifying net annual premium deposits, adjusted for policy length, or 100% of net unearned deposits. A separate contingent reserve must meet the minimum capital required of a comparable stock insurer authorized elsewhere. Subscribers or their representative must advance money to cover reserve shortages; repayment comes only from surplus above the minimum. Subscriber agreements must generally provide potential extra liability of one to ten times the annual cash premium deposit. Exchanges with at least $350,000 in surplus, or a higher required minimum, can issue policies without that extra liability. Admission standards include a $300,000 general minimum surplus and separate requirements by insurance line. Foreign exchanges must deposit $100,000 to protect policyholders. Liability under any policy is limited to 10% of surplus unless the excess is reinsured with a qualified company. Exchanges remain subject to state insurance taxes, fees, rating rules, and workers’ compensation laws when offering that coverage. Most producer-licensing rules exempt managing representatives and salaried executives, but apply to other agents. Hearings and court review are available; noncompliance carries misdemeanor fines of $100 to $1,000.
Sponsors & Cosponsors
Sponsor
Brian Patrick Kennedy
Democratic • House
Cosponsors
Samuel A. Azzinaro
Democratic • House
Grace Diaz
Democratic • House
John G. Edwards
Democratic • House
Katherine S. Kazarian
Democratic • House
William W. O'Brien
Democratic • House
Joseph J. Solomon, Jr.
Democratic • House
Roll Call Votes
Senate vote • 6/21/2025
RELATING TO INSURANCE--VOLUNTARY RESTRUCTURING SOLVENT INSURERS In Concurrence Passage
Yes: 34 • No: 0
House vote • 6/16/2025
INSURANCE/SOLVENT INSURERS PASSAGE
Yes: 72 • No: 0
Actions Timeline
Signed by Governor — Chapter 452
7/2/2025GovernorTransmitted to Governor
6/27/2025GovernorSenate passed Sub A in concurrence
6/21/2025SenatePlaced on Senate Calendar (06/20/2025)
6/18/2025SenateHouse passed Sub A
6/16/2025HousePlaced on House Calendar (06/16/2025)
6/13/2025HouseCommittee recommends passage of Sub A
6/12/2025Proposed Substitute
6/9/2025Scheduled for consideration (06/12/2025)
6/9/2025Committee recommended measure be held for further study
3/4/2025Scheduled for hearing and/or consideration (03/04/2025)
2/28/2025Introduced, referred to House Corporations
2/26/2025House
Bill Text
H5548 - As Introduced
2/26/2025
H5548 - Substitute
2/26/2025
Related Bills
H5372, AN ACT RELATING TO TOWNS AND CITIES -- RELIEF OF INJURED AND DECEASED FIRE FIGHTERS AND POLICE OFFICERS .
H5494, AN ACT RELATING TO INSURANCE -- MEDICARE SUPPLEMENT INSURANCE POLICIES .
H5506, AN ACT RELATING TO LABOR AND LABOR RELATIONS -- EMPLOYEES' FREE SPEECH IN WORKPLACE .
H5464, AN ACT RELATING TO HEALTH AND SAFETY -- PUBLIC HEALTH AND WORKPLACE SAFETY ACT .
H5187, AN ACT RELATING TO LABOR AND LABOR RELATIONS -- LABOR RELATIONS ACT .
H5155, AN ACT RELATING TO BUSINESSES AND PROFESSIONS -- ARCHITECTS .