Yesterday the New York State Assembly announced new legislation to curb Iran’s continuing nuclear pursuits. Below is a press release from the unveiling. You can find the text, and accompanying video here.
Speaker Sheldon Silver announced today the introduction of a bill (A.6855) that builds upon the Iran Divestment Act by prohibiting domestic insurers from including as admitted assets investments in any company engaged in investment activities in Iran.
Admitted assets, which are defined in the state Insurance Law, are investments included on an insurance company’s financial statements. Admitted assets are used to determine an insurance company’s solvency and, therefore, its ability to pay claims.
“While I hope this legislation further encourages divestment in Iran, it is my primary purpose to protect policyholders by making certain that the investments of our domestic insurers are financially sound,” said Silver. “Investments in a nation as volatile as Iran, a nation that is developing nuclear weapons and has threatened to use them against Israel and the West, a nation that brutally oppresses its own people, a nation that sponsors terrorism worldwide, should never be considered a sound investment.”
Currently, domestic insurance companies could have in their portfolios shares in certain companies that invest in Iran. This bill would protect citizens by regulating the investments of insurance companies in New York. Making certain that insurers invest in companies who in turn invest and support entities that are financially sound is good for the state and good for policyholders.
This measure would guarantee that investments made by domestic insurance companies in entities that invest in the Iranian energy sector are non-admitted assets. Insurers would be required to determine what investments, transfers, or other transactions have been made with companies included on the list of entities that invest in the Iranian energy sector maintained by the state Office of General Services (OGS). As of March 1, 2014, and annually thereafter, insurers would be required to provide the Department of Financial Services with the list of such investments and transactions.
The Iran Divestment Act, sponsored by Speaker Silver and signed into law last year, conforms New York State’s procurement practices to authorization granted by the federal government. It allows states to use their procurement powers towards halting the development of nuclear weapons in Iran. It requires the State Office of General Services (OGS) to create a public list of individuals or companies that invest an excess of $20 million in goods, services or credit in the Iranian energy sector. Entities on the list are prohibited from entering into or renewing contracts with New York State and local governments. The provisions of the act were later expanded to apply to SUNY, CUNY and state and local public authorities, as well as state agencies and local governments.
“This legislation would prohibit investments made by insurance companies in certain companies that do business in Iran from being considered an admitted asset. It is important for New York policyholders to be assured that insurance products sold in New York are backed by sound and secure investments,” said Assemblyman Chuck Lavine.
The Iran Divestment Act is similar to legislation in California. Laws with the same purpose are in effect in Florida, Maryland, New Jersey, and Indiana and have been introduced in several other states including neighboring Connecticut. It was conceived with the aid of the Jewish Community Relations Council of New York.
“Once again, Speaker Silver has demonstrated that the State of New York will do everything in its power to isolate the Iranian regime and prevent it from achieving nuclear weapon’s capability. By throwing the weight of New York State behind growing national and international efforts to stop Iran, we stand here confident in our knowledge that our representatives are on the right side of history,” said Michael S. Miller, executive vice president and CEO, Jewish Community Relations Council of New York.
In 2009, at the direction of State Comptroller Thomas DiNapoli, more than $86 million in New State Common Retirement Fund investments were divested from nine companies that were linked to business activities in Iran and Sudan.
The Comprehensive Iran Sanctions, Accountability and Divestment Act was signed into law by President Barack Obama in July 2010, blocking any companies that are linked to Iran’s regime from winning contracts with the federal government.