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Coalition for American Insurance: Positive News for Florida Insurance Consumers

Washington, D.C. (June 8, 2018) – The Coalition for American Insurance pointed to welcome news by JLT Re that capital in the reinsurance market remains strong and reinsurance renewal rate changes for Florida property were negligible at the June 1 renewal, much lower than had been predicted. In a statement, JLT Re noted that “Overall, the renewal was highly competitive, reflecting abundant capacity and only moderate increases in demand despite the market suffering its most expensive catastrophe loss year on record in 2017.”

A statement from the Coalition follows:

“Contrary to prior negative predictions on Florida markets by those who had benefitted from the Offshore Affiliate Reinsurance Tax Loophole and opposed the Base Erosion and Anti-Abuse Tax (BEAT) of the Tax Cuts and Jobs Act (P.L. No 115-97), this welcome news is more evidence that tax reform is working as intended. This news comes despite record losses in 2017.  Strong capital in the market and lower reinsurance rates will have a direct positive effect for all consumers in the Florida market.”

 

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ABOUT THE COALITION –

The Coalition for American Insurance consists of major U.S.-based insurance groups that employ hundreds of thousands of people within the United States. Coalition members provide millions of Americans with financial protection from unpredictable risks and pay substantial amount of federal, state and local taxes. The Coalition is working for a level playing field and tax fairness for U.S.-based insurers and their consumers and employees by closing a federal tax loophole that has allowed foreign-based insurers to avoid paying U.S. taxes.

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Coalition:  Tax Cuts and Jobs Act Working for America

WASHINGTON, D.C. (May 9, 2018) – The Coalition for American Insurance finds more welcome news that the Tax Cuts and Jobs Act (Pub. L. No 115-97) is continuing to work as intended, reversing the erosion of the U.S. tax base and loss of taxes on U.S. generated insurance business, as evidenced by changes to internal company reinsurance agreements at a number of foreign owned groups. For example, Arch Capital Group recently disclosed that it has canceled its prior internal company reinsurance arrangement. Before the new tax law, these affiliated reinsurance arrangements were used to send business from the United States to foreign countries in order to take advantage of an almost zero percent corporate tax rate.  As a direct result of the new tax law’s Base Erosion and Anti-Abuse Tax (BEAT) any tax advantage by foreign based insurers in offshoring reinsurance on U.S. generated business has been significantly reduced, effectively eliminating the competitive advantage over U.S. Companies, and helping stem U.S. Base Erosion.

A statement from the Coalition follows:

“More welcome news and clear evidence that the Tax Cuts and Jobs Act is working as intended in the insurance marketplace. Congress recognized the problem the Insurance Tax Haven loophole created by allowing foreign-based insurers to do business in the U.S. – but avoid paying U.S. taxes – and took important steps toward eliminating the tax advantage. Foreign-based insurers now compete on a more level playing field with American companies on U.S. business, making the insurance market more competitive, and benefiting consumers.  Moreover, reinsurance capacity has remained strong and pricing competitive. The Coalition again thanks Congress for recognizing this problem and addressing it.  We are pleased with the continuation of this positive trend for the U.S. insurance industry and the benefit to consumers, employees and the U.S. economy.

 

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 ABOUT THE COALITION –

The Coalition for American Insurance consists of major U.S.-based insurance groups that employ hundreds of thousands of people within the United States. Coalition members provide millions of Americans with financial protection from unpredictable risks and pay substantial amount of federal, state and local taxes. The Coalition is working for a level playing field and tax fairness for U.S.-based insurers and their consumers and employees by closing a federal tax loophole that has allowed foreign-based insurers to avoid paying U.S. taxes.

 

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WASHINGTON, D.C. (January 10, 2018) – The Coalition for American Insurance pointed to news that Assurant, Inc. will remain a U.S.-based company as proof that the Tax Cuts and Jobs Act is already keeping U.S. jobs and profits here at home. Assurant, Inc. announced in a statement it will amend the structure of its previously announced deal with The Warranty Group and remain a Delaware corporation because of the new law. A statement from the Coalition follows:

 

“This is welcome news and clear evidence that the Tax Cuts and Jobs Act is already having a positive impact on the insurance marketplace. Congress recognized the problem the Insurance Tax Haven loophole created by allowing foreign-based insurers to do business in the U.S. but avoid paying taxes and took the important step of closing it. For too long, U.S.-based companies inverted their operations to take advantage of this loophole. But thanks to a more equitable tax treatment for all insurers established in the bill, companies are realizing it makes good sense to stay in the U.S. This makes the industry more competitive, which benefits consumers. Additionally, these changes are already helping stem the tide of corporate inversions that had plagued our industry for many years. The Coalition thanks Congress for recognizing a problem and taking steps to solve it. We are seeing real world evidence that taxes do matter and the right kind of changes were made to get our economy going again. This is a positive trend for the U.S. insurance industry and will benefit consumers, employees and the overall economy.”

 

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ABOUT THE COALITION –

The Coalition for American Insurance consists of twelve major U.S.-based insurance groups that employ hundreds of thousands of people within the United States. Coalition members provide millions of Americans with financial protection from unpredictable risks and pay substantial amount of federal, state and local taxes. The Coalition is seeking a level playing field and tax fairness for U.S.-based insurers and their consumers and employees by closing a current federal tax loophole that allows foreign-based insurers to avoid paying U.S. taxes.

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WASHINGTON, D.C. (December 20, 2017) – The Coalition for American Insurance is pleased to thank Congress for passing the Tax Cuts and Jobs Act, an important policy achievement for the U.S. insurance industry and its customers. The first major tax reform package in three decades will establish a more level playing field for all insurers doing business in the U.S. by reforming a decade-old loophole that allowed foreign-based insurance companies to avoid paying tax on their U.S.-generated insurance profits.  A statement from the Coalition follows:

 

“Congress is to be congratulated on passage of the Tax Cuts and Jobs Act. This important legislation includes reforms to the tax code that will stimulate job creation and economic growth here at home. It will also help maintain a strong and vibrant U.S. insurance industry, which will provide consumers with greater choices and competition in the insurance marketplace. The Base Erosion and Anti-Abuse Tax (BEAT) is an important reform that will reduce the incentive to send U.S.-generated profits overseas. The Coalition looks forward to working with policymakers as these reforms are implemented in the coming year.”

 

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ABOUT THE COALITION –

The Coalition for American Insurance consists of twelve major U.S.-based insurance groups that employ hundreds of thousands of people within the United States. Coalition members provide millions of Americans with financial protection from unpredictable risks and pay substantial amount of federal, state and local taxes. The Coalition is seeking a level playing field and tax fairness for U.S.-based insurers and their consumers and employees by closing a current federal tax loophole that allows foreign-based insurers to avoid paying U.S. taxes.

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WASHINGTON, D.C. (December 18, 2017) – The Coalition for American Insurance strongly supports the final version of the Tax Cuts and Jobs Act. The historic legislation includes a significant reform that will ensure more equal tax treatment for U.S. based insurers and consumers by addressing a longstanding loophole that allowed foreign insurance companies to move their U.S.-generated insurance profits abroad to avoid tax.

 

“With this agreement, Congress has made good on its promise to create U.S. jobs and to keep American companies competitive in the global marketplace. Importantly, the Tax Cuts and Jobs Act helps to close the tax haven loophole in the current tax code that unfairly rewarded the transfer of profits and jobs overseas. Now, with the inclusion of the Base Erosion and Anti-Abuse Tax (BEAT) to impede the offshoring of profits by foreign companies to tax havens, all insurers operating in the U.S. market will do so on the most level playing field in decades.

 

“The BEAT is not discriminatory. Instead, it ensures that all companies doing business in the United States will pay U.S. taxes on that business. This is an important reform that will help maintain a thriving American-based insurance industry and enhance choices for all consumers.

 

“We strongly urge members of the House and Senate to approve the Tax Cuts and Jobs Act so that this bill can be signed into law this year.”

 

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Posted by & filed under Letters, News.

WASHINGTON, D.C. (December 8, 2017) – The Coalition for American Insurance is urging members of the Conference Committee on the Tax Cuts and Jobs Act to maintain language included in the Senate passed version of the bill that takes significant steps to close the Insurance Tax Haven Loophole. In a letter to conferees, the Coalition said the language is necessary to establish a level playing field between U.S. and foreign based insures operating in the U.S. The letter reads in part:

 

“The Base Erosion and Anti-Abuse Tax (BEAT) established in the Senate-passed bill will combat base erosion and prevent U.S. generated profits from being shifted overseas. This is of particular importance in the insurance industry. Under current law, foreign-based insurers are able to strip their profits from U.S. generated business to affiliates located in low or no tax jurisdictions like Bermuda. If nothing is changed, this loophole will cost the U.S. taxpayer nearly $9 billion over the next decade and continue to give foreign-based insurers a significant competitive advantage over U.S. companies.

 

“It is important to note that the BEAT language included in the Senate bill would not penalize foreign-based companies. Instead, they would have the option to be treated like U.S. based companies or pay the BEAT tax, bringing their total tax payment in line with what is already being paid by U.S. based insurers.

 

“Our nation’s tax code should not incentivize the inversion of U.S. based companies or the offshoring of U.S. generated profits. The inclusion of the BEAT in the Tax Cuts and Jobs Act will ensure that these incentives are at the very least reduced and all insurers and businesses will pay taxes on profits earned here in the U.S.”

 

To read the full letter please click HERE.

 

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ABOUT THE COALITION –

The Coalition for American Insurance consists of twelve major U.S.-based insurance groups that employ hundreds of thousands of people within the United States. Coalition members provide millions of Americans with financial protection from unpredictable risks and pay substantial amount of federal, state and local taxes. The Coalition is seeking a level playing field and tax fairness for U.S.-based insurers and their consumers and employees by closing a current federal tax loophole that allows foreign-based insurers to avoid paying U.S. taxes.

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WASHINGTON, D.C. (December 2, 2017) – The Coalition for American Insurance applauds Senate approval of tax reform legislation. The Senate passed version of the Tax Cuts and Jobs Act takes significant steps to close the Insurance Tax Haven Loophole and thereby will ensure that foreign-based insurers can no longer offshore U.S.-generated profits to avoid U.S. taxes.

 

“We are very pleased the Senate passed bill will help establish a fairer playing field and tax treatment for all insurers operating in the U.S. The Insurance Tax Haven loophole has cost the U.S. taxpayers billions of dollars and given foreign-based insurers doing business here a significant competitive advantage over those still based in the U.S. for far too long. The bill approved by the Senate today takes important and necessary steps toward eliminating this loophole.

 

“This is a common sense change. Companies doing business in the U.S. should pay taxes here. Under the Senate-passed bill, foreign based companies are not penalized. On the contrary, they could either be taxed similar to U.S. based companies or pay a base erosion alternate tax. While this option still allows foreign insurers a slightly more favorable tax treatment than U.S. based insurers, it essentially closes the Insurance Tax Haven Loophole in current law. U.S. insurers will continue to be subject to the full U.S. tax liability.

 

“As the tax reform process moves to the conference committee stage, it is essential that policy makers adhere to the Senate approach on closing the loophole and ending incentives for companies to shift jobs and revenue overseas. Our nation’s tax code should not subsidize foreign-headquartered companies, particularly those that were once based here but inverted for a tax advantage.”

 

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ABOUT THE COALITION –

The Coalition for American Insurance consists of twelve major U.S.-based insurance groups that employ hundreds of thousands of people within the United States. Coalition members provide millions of Americans with financial protection from unpredictable risks and pay substantial amount of federal, state and local taxes. The Coalition is seeking a level playing field and tax fairness for U.S.-based insurers and their consumers and employees by closing a current federal tax loophole that allows foreign-based insurers to avoid paying U.S. taxes.

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Posted by & filed under Letters, News, Opinions, Uncategorized.

WASHINGTON, D.C. (November 27, 2017) – The Coalition for American Insurance voiced support today for a recent Wall Street Journal editorial that focused on the importance of reducing base erosion through tax reform. The original editorial can be viewed HERE. The text of the Coalition letter is below.

Senate’s Take on Tax: Best to Reduce Gaming
WSJ, Letter to Editor, November 27, 2017

The current tax code is full of loopholes that allow foreign-based companies operating in the U.S. to avoid paying taxes here on their U.S.-generated business.
The editorial “Reducing Corporate Tax Games” (Nov. 20) rightly recognizes the importance of dealing with base erosion in tax reform. The current tax code is full of loopholes that allow foreign-based companies operating in the U.S. to avoid paying taxes here on their U.S.-generated business. Meanwhile, U.S.-based companies are competing for the same business but paying full freight.
This unequal tax treatment creates winners and losers and gives companies that invert to low or no tax jurisdictions (tax havens) a very real and significant competitive advantage in the marketplace. From the perspective of U.S.-based insurers, this is a real problem. Foreign-based insurers are currently allowed to strip profits generated in the U.S. to overseas affiliates and avoid paying any taxes on that income. That’s a glaring loophole that has cost U.S.-taxpayers nearly $9 billion over a decade.
The Senate’s approach to closing this loophole is indeed the better one than that approved by the House, whose weak provisions undermined its own professed goal to stop inversions. The Senate approach should carry the day. Base erosion is a very real problem, particularly in the insurance industry. Comprehensive tax reform is the right place to deal with it.

William R. Berkley
On behalf of the Coalition for
American Insurance

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Posted by & filed under Letters, News, Uncategorized.

WASHINGTON, D..C. (November 17, 2017) – In a letter to Senate leaders today, the Coalition for American Insurance commended the Senate for including strong anti-base erosion provisions in its version of the Tax Cuts and Jobs Act to help close the Insurance Tax Haven loophole. The letter reads in part:

 

“The Coalition for American Insurance commends the United States Senate for recognizing the need to eliminate incentives in the tax code that encourage businesses to move overseas.  America can no longer afford the loss of jobs and capital being transferred overseas which is why it is critical to establish a level playing field for the tax treatment of U.S.-based insurers and foreign-based insurers.  Specifically, the Coalition is encouraged that the Senate Finance Committee included strong anti-base erosion language that recognizes the long standing deficiencies in the tax code which have promoted inversions of American owned insurance companies and acquisitions by foreign company groups.”

 

Click HERE to read the letter in full.

 

ABOUT THE COALITION –

The Coalition for American Insurance consists of twelve major U.S.-based insurance groups that employ hundreds of thousands of people within the United States. Coalition members provide millions of Americans with financial protection from unpredictable risks and pay substantial amount of federal, state and local taxes. The Coalition is seeking a level playing field and tax fairness for U.S.-based insurers and their consumers and employees by closing a current federal tax loophole that allows foreign-based insurers to avoid paying U.S. taxes.

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WASHINGTON, D.C. (November 16, 2017) – Congressman Ted Budd (R-NC) delivered a statement on the floor of the U.S. House of Representatives today in support of closing the Bermuda Insurance Tax Haven loophole. The loophole allows foreign-based insurers to shelter income overseas and avoid paying U.S. taxes. Congressman Budd has been a leader on this issue and sent a dear colleague letter to Ways and Means Committee Chairman Brady urging the closure of the loophole. Watch the full speech below.

Congressman Budd Speech on House Floor from Coalition for American Insurance on Vimeo.

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