SB 70-OWNER & CONTRACTOR CONTROLLED INSURANCE                                                                      
                                                                                                                                
2:03:14 PM                                                                                                                    
CHAIR BJORKMAN announced the consideration  of SENATE BILL NO. 70                                                               
"An Act relating to coverage  for additional insureds under owner                                                               
and contractor  controlled insurance programs; and  providing for                                                               
an effective date."                                                                                                             
                                                                                                                                
CHAIR BJORKMAN stated that the  committee amended the bill during                                                               
the previous hearing.  He asked whether there  were any questions                                                               
for the  director of insurance  before he  looked to the  will of                                                               
the committee.                                                                                                                  
                                                                                                                                
2:04:27 PM                                                                                                                    
SENATOR GRAY-JACKSON requested a refresher on SB 70.                                                                            
                                                                                                                                
2:04:53 PM                                                                                                                    
LORI WING-HEIER,  Director, Division of Insurance,  Department of                                                               
Commerce, Community and  Economic Development, Anchorage, Alaska,                                                               
gave  a  refresher  on  SB  70.  She  explained  that  owner-  or                                                               
contractor-controlled  insurance  programs  are the  opposite  of                                                               
traditional  insurance contracts  between  the  owner or  general                                                               
contractor  and the  subcontractors. In  a traditional  contract,                                                               
all the subcontractors are required  to buy insurance and pass it                                                               
up. In an  owner controlled insurance program  (OCIP), the owner,                                                               
such  as Exxon,  buys insurance  and passes  it down  to all  the                                                               
contractors  on  the   project.  Worker's  compensation,  general                                                               
liability  and  professional  liability  would all  be  under  an                                                               
owner- or contractor-controlled insurance program.                                                                              
                                                                                                                                
When  attorneys  for  the  Division  of  Insurance  examined  the                                                               
statutory  language   regarding  additional  insureds   on  large                                                               
infrastructure  projects  on  the  North  Slope,  they  said  the                                                               
language was not sufficient to  accommodate OCIPs. Therefore, the                                                               
impetus  behind  SB  70  is to  ensure  that  subcontractors  are                                                               
covered under the owner's master insurance program.                                                                             
                                                                                                                                
2:07:01 PM                                                                                                                    
SENATOR  GRAY-JACKSON  moved to  report  SB  70, work  order  33-                                                               
GS1009\A,   as   amended,    from   committee   with   individual                                                               
recommendations and attached fiscal note(s).                                                                                    
                                                                                                                                
CHAIR BJORKMAN found no objections  and CSSB 70(L&C) was reported                                                               
from the Senate Labor and Commerce Standing Committee.