The proposed legislation aims to create a more sustainable property insurance system for public schools, state-supported institutions of higher education, and state-owned properties in Arkansas by establishing the State Captive Insurance Program. This program will consolidate existing property insurance programs under a single framework and will be overseen by the newly created Office of Property Risk within the Department of Transformation and Shared Services. The bill mandates cooperation among state entities to ensure effective coverage and proper property valuation while prohibiting the use of public adjusting in property insurance claims. It also includes transitional provisions for transferring existing insurance programs to the new system, with a completion deadline of December 1, 2026, and emphasizes accountability and transparency in operations.

Additionally, the bill amends various sections of Arkansas law to enhance insurance requirements and reporting obligations for public school districts and related entities, including a requirement to report on cybersecurity risks insurance programs. It establishes the "State Insurance Programs Oversight Subcommittee" to oversee decisions related to the State and Public School Life and Health Insurance Program and the State Captive Insurance Program. The legislation also introduces provisions for the establishment of a captive insurance company funded through a newly created trust fund, which will be used exclusively for claims and operational expenses. Overall, the bill aims to improve the insurance framework for public schools, particularly concerning cybersecurity risks and the management of school facilities, while ensuring financial stability and legislative oversight.

Statutes affected:
SB 481: 6-20-1503, 6-20-1505, 6-20-1506, 6-20-1508, 6-20-1513, 6-21-114(d), 6-21-806, 6-21-803, 6-21-804, 6-21-808, 10-3-320, 19-5-1134, 6-20-1501, 6-21-701, 6-20-1510, 19-5-908, 6-21-710, 19-5-981, 23-63-1614, 23-65-315, 19-3-706, 25-35-102, 25-35-103(b), 25-35-104(a), 25-35-105(b), 25-35-107, 25-35-108
Act 779: 6-20-1503, 6-20-1505, 6-20-1506, 6-20-1508, 6-20-1513, 6-21-114(d), 6-21-806, 6-21-803, 6-21-804, 6-21-808, 10-3-320, 19-5-1134, 6-20-1501, 6-21-701, 6-20-1510, 19-5-908, 6-21-710, 19-5-981, 23-63-1614, 23-65-315, 19-3-706, 25-35-102, 25-35-103(b), 25-35-104(a), 25-35-105(b), 25-35-107, 25-35-108