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HB 1826

Insurance Companies, Agents, Brokers, Policies - As enacted, increases from $100,000 to $250,000 the retained risk limit for a single risk covered by a policy of insurance issued by a county mutual insurance company. - Amends TCA Title 56, Chapter 22.

114th Regular Session (2025-2026) Introduced by Rick Eldridge

Tennessee bill raises county mutual insurance companies' retained risk limit to $250,000, allowing them more independent claims coverage but increasing insolvency risk.

Comp. became Pub. Ch. 739
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Bill Summary · HB 1826

Legislative bill overview

HB 1826 increases the retained risk limit for county mutual insurance companies in Tennessee from $100,000 to $250,000 per single insured risk. Retained risk refers to the portion of insurance liability that a company keeps for itself rather than transferring to reinsurers. This adjustment allows these smaller, regional insurers more financial capacity to cover losses independently.

Why is this important

County mutual insurance companies are typically smaller, locally-focused insurers that serve rural and underserved areas. Increasing the retained risk limit could improve their financial stability and competitive position, potentially leading to better rates or service availability in those regions. However, it also increases the financial exposure these companies face if major claims occur, which could affect their solvency and policyholders' security.

Potential points of contention

  • Financial risk to insurers: Raising the limit from $100,000 to $250,000 significantly increases the amount of uninsured risk county mutuals must absorb, potentially threatening company solvency if multiple large claims materialize
  • Consumer protection concerns: Higher retained risk means less protection for policyholders if an insurer becomes insolvent, since claims may exceed available reserves
  • Competitive fairness: The change may disproportionately benefit larger mutual insurers with deeper capital reserves while exposing smaller ones to dangerous exposure levels

Compiled from official sources — confirm details with the bill’s official record.

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