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 Office of Property Risk within the Department of Transformation and Shared Services and introducing the State Captive Insurance Program. This program will consolidate existing property insurance programs and requires cooperation among state entities to ensure effective coverage and accurate property valuations. Key provisions include the transfer of property insurance programs to the new State Captive Insurance Program by December 1, 2026, independent reappraisals of properties, and the prohibition of public adjusting in property insurance claims to stabilize premiums and improve market options.

The bill also amends various sections of Arkansas law to enhance insurance requirements and reporting obligations for public school districts and related entities, including comprehensive reporting on cybersecurity risks insurance programs. It mandates that school districts must be insured under the State Captive Insurance Program to qualify for state financial participation in academic facilities programs and introduces a requirement for a six-year facilities master plan. Additionally, the bill establishes the "State Insurance Programs Oversight Subcommittee" to oversee decisions related to the State Captive Insurance Program and creates a captive insurance company to manage risks for state agencies and public schools. The legislation emphasizes financial stability, requiring the Secretary to maintain a reserve balance between $50 million and $75 million and mandates annual reporting on the program's status.

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