NU Online News Service, April 19, 4:21 p.m. EDT, Washington-Equitas, the Lloyd's runoff mechanism, said the Senate's proposed asbestos claim legislation denies it safe harbor on liabilities available to other insurance operations.
A spokesman for the London-based company says Equitas "will continue to work to get the discriminatory language removed." But, the spokesman said, "We cannot support the bill in its present form."
Another provision in the new bill under fire from the insurance industry is its "no subrogation" provision, which means that insurers and defendants paying a claim to a worker injured by exposure to asbestos cannot include a lien against workers' compensation payments already made to the claimant.
The AFL-CIO, however, in an April 15 statement on the bill, lauded the no subrogation provision, calling it "an important improvement" to earlier versions of the bill.
The safe harbor provision opposed by Equitas says that all insurers and reinsurers except Equitas would be given the right to either reduce or defer the amount they must pay to the fund if they can demonstrate it is unfair or that it would force them into bankruptcy.
A lawyer representing Equitas spoke against the provision at a January hearing held by the Senate Judiciary Committee. The provision was contained in a bill proposed by Sen. Arlen Specter, R-Pa., chairman of the committee.
Equitas is the mechanism established by the Lloyd's market to run-off liabilities of Lloyd's syndicates prior to 1993. Those liabilities include asbestos and environmental liabilities.
Scott Moser, Equitas chief executive officer, said in January at the time of the testimony that, "What we object to is the idea that this should be done for literally every other insurance company in the world except Equitas.
"U.S. insurers and reinsurers, quite frankly, would prefer money to come from London than to come from them, and they have more votes than Londoners" he said.
Mr. Moser added: "It is not as grandiose as nationalistic. It is naked commercialism. If you pay instead of me, I get a competitive advantage over you. If the London market is disrupted, that is in the interests of U.S. insurers and reinsurers who are competing with it."
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