Rhode Island Officials Act to Keep FM Global from Leaving
In a bid to retain FM, a major insurance company, Rhode Island officials are proposing a legislative change to investment restrictions that could strengthen the state’s business climate. House Speaker Joe Shekarchi revealed that FM, formerly known as FM Global, reached out for assistance regarding a 10% cap on alternative investments for insurance companies. This cap, they argue, puts them at a competitive disadvantage compared to Massachusetts, where no such limits exist.
Shekarchi emphasized that the proposed change would have no financial implications for Rhode Island taxpayers. “They want to create the best business atmosphere to stay and grow in Rhode Island,” he stated, urging that a conducive environment might prevent FM from exploring relocation options.
Governor Dan McKee’s office has acknowledged ongoing discussions with FM about the competitive landscape in Rhode Island, particularly for the insurance sector. The governor plans to submit legislation that would eliminate the investment cap, thereby allowing local insurers greater flexibility in managing their portfolios. This move has also garnered attention from other local firms, including Lincoln-based Amica.
FM, a property insurance giant established in 1835, employs 1,381 individuals in Rhode Island and nearly 6,000 worldwide. Spokesman Robert Julavits expressed support for the proposed legislative change, stating that it would enhance the business environment and safeguard policyholder interests without compromising investment strategies.
Furthermore, Shekarchi noted that similar concerns have arisen with Hasbro, another iconic Rhode Island company considering a move. He remarked on FM’s significant presence, citing its $11 billion valuation, and stressed the importance of supporting the initiatives that contribute to its growth and success in the state. A bill to lift the investment cap is anticipated to be introduced next week by Rep. Alex Finkelman.
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