The bill amends the "Rhode Island Limited Liability Company Act" by replacing the existing act with a newer and updated model act. It introduces new provisions that require registered limited liability partnerships (LLPs) and limited liability companies (LLCs) providing professional services to maintain liability insurance, with coverage ranging from a minimum of $100,000 to a maximum of $500,000 based on the number of professional employees. The bill establishes conditions for disputing compliance with these insurance requirements in court, ensuring that compliance cannot be disclosed to juries during liability determinations.

The new act includes sections on definitions, formation, management, and liability of LLCs, enhancing clarity and operational efficiency. It addresses the management, operation, and dissolution of LLCs, including provisions for the conversion of entities, the issuance of certificates of revocation, and the handling of mergers and consolidations. The act clarifies the rights and responsibilities of members and managers, the processes for filing and correcting records, and the conditions under which an LLC may be dissolved or reinstated.

Section 1 of the act takes effect upon passage, while Sections 2 and 3 take effect on January 1, 2027.