Kenneth Bollier, president of the American Association of State Compensation Insurance Funds (AASCIF), recently met with U.S. Senator Charles Schumer (D-New York) and the staffs of Senators Barbara Boxer (D- California) and Chris Dodd (D-Connecticut) to underscore that passage of federal terrorism reinsurance “backstop” legislation is vital to protect the “workers’ compensation safety net” for hundreds of thousands of employers and millions of employees across the nation.
Bollier, speaking on behalf of state funds nationwide and as president of the California State Compensation Insurance Fund, said that such legislation will safeguard the nation’s workers’ comp system.
Citing the socio-economic devastation following the events of Sept. 11, Bollier emphasized in the meetings held in Washington, D.C. the crucial role of State Funds—which cannot currently exclude losses caused by terrorist activity unlike private insurance carriers—in the nation’s economy.
After Sept. 11, private reinsurance for terrorism-caused catastrophic events became virtually unavailable in most states. This means that state funds bear ultimate responsibility for potentially hundreds of millions of dollars in claims costs from a terrorist attack.
“State funds are at the vanguard of protecting the financial stability and security of America’s businesses and protecting injured workers,” Bollier said. “Most state funds could not survive an event involving even one-tenth of the estimated workers’ compensation costs involved in the World Trade Center attacks. Effectively, we are bearing the risk of war, which should be a function of the government.”