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House Co-Sponsorship Memoranda
House of Representatives
Session of 2021 - 2022
Regular Session
MEMORANDUM
| Posted: | October 12, 2021 09:33 AM |
|---|---|
| From: | Representative Kate A. Klunk |
| To: | All House members |
| Subject: | Making Indemnification Language Unenforceable in Governmental Contracts with Private Children and Youth Social Service Agencies and Children Residential Services |
| In the near future, I plan to introduce legislation to protect the continued viability of private children and youth social service agencies and residential treatment providers. For the last several years, at the time of renewing their professional liability policies, these private provider agencies have faced increased costs and decreased coverage, with more and more limited coverage options, drastically higher premiums, and policies without tails. Some insurers are leaving the market altogether. This dire situation is driven in part by county contracts that require the provider to defend and indemnify the county agency, regardless of who is alleged to be at fault. As a result, providers of behavioral health, drug and alcohol services, foster care, adoption services, and residential treatment are finding it increasingly cost prohibitive – and sometimes literally impossible - to obtain professional liability insurance. My bill will help to ensure the continued viability of these essential service providers by making indemnification language in government contracts that currently shift all liability to third party providers unenforceable. This legislation will NOT provide the agencies with immunity for any type or class of claim that is due to their own negligence. Instead, each party will retain ownership of its own negligence. This is a key tenant of good risk management and will help to create a fairer and safer system for everyone including at-risk children and their families. The liability insurance market in this industry has been unstable for more than three years, and the time to act is now. I believe my legislation is crucial to maintaining needed child services throughout the Commonwealth, and I ask for your support. |
Introduced as HB2214
Memo Updated: October 12, 2021 09:34 AM