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CIS Financial, Inc. fax: (303) 694-0766

We thank you for this opportunity to present testimony regarding the resolution of Tort conflicts involving Indian Tribes.

Commercial Insurance

fax: (303) 694-0553

Professional Insurance

Network, Inc. fax: (303) 694-6512

It appears that many people are under the impression that Tribal Governments,
in general, attempt to avoid their responsibility to the public at large by using
Sovereign Immunity as a defense against Tort Claims that occur on the

Certified Investment & Insurance Services, Inc. fax: (303) 488-2182

CIS Program Services, Inc. fax: (303) 694-6512

CIS Risk Management

Services, Inc. fax: (303) 694-1309

CIS of New Mexico, Inc. Ph: (505) 837-2206 fax: (505) 837-2209

It also seems that allegations have been made that the Tribal Courts are not competent to handle Tort issues that come before it. Also that a "non-Indian” has no chance of a fair hearing before a Tribal Court. We believe that this is a result of the fact that Reservation leaders and Tribal Courts are following a cultural philosophy that is based on awarding true or real damages and does not recognize punitive or exemplary damages. They also are very protective of their rights as a Sovereign to govern themselves. Sovereignty is a word that is vastly misunderstood by the general public. What the Tribes are trying to say is that they are “Sovereign" as a Nation of People within the Nation of the U.S.A. As a Sovereign they want the ability to govern themselves, their people and their lands, in the same way that states have their right of Sovereignty, just as long as it is not in conflict with Federal Laws and/or Mandates. Unlike many courts that find ways to extend fault, Tribal Courts try to assess the true and real damage and to determine to what extent there may have been contributory negligence on the part of the injured Claimant. This is not avoiding responsibility, rather it is more a case of trying to be responsible and not allow the system to be abused.

In addition many of the Tribes have authorized the Inter-Tribal Arbitration Council (ITAC) to resolve these types of issues while respecting the insurance contract and conforming to Tribal

Federal Laws.

6143 S. Willow Drive, Suite 330.... Englewood, CO 80111.... 303-694-6466

July 13, 1998
Page 2

My Associate, Claire Tull, and I have been working with Tribal Governments, their respective program divisions and enterprise operations for the past eleven years. During that time we have not had any of our participating Tribes avoid or deny legitimate Tort Claims using Sovereignty as their defense.

At present, we represent over 200 separate Tribes and Tribal Entities throughout the lower 48 States. Each of these organizations carries a minimum of $1,000,000 of General Liability coverage for their general operations with certain extensions including Products/Completed Operations, Personal Injury and Tribal Officials Errors and Omissions, etc.

Our experiences with Tribal Governments, Tribal Organization and Tribal Courts have been in relation to insured Tort injuries. We work very closely with the insurance coordinator in investigating the true/actual cause of that injury and how the insuring agreements contained within the policies respond to the claim and how the exclusions within the policies narrow or broaden the scope of coverage provided. Any insurance company we work with cannot use a defense of Sovereignty to avoid coverage or payment of a legitimately covered claim without the written permission of the Tribe. We also believe that some companies in the past were guilty of taking premiums and then using the Tribe's Sovereignty as their reason not to pay the claims that occurred, legitimate or not. We don't believe that continues with the insurance programs dedicated to Tribal entities today. Specialized insurance programs for Tribal Entities currently provide comprehensive coverage at extremely competitive rates. Our program also gives premium credit for all 638 programs and in no way could the Sovereign Immunity of the Tribe be limited outside or beyond the coverage or limits of the policy.

The organizations we work with in Indian Country are very aware of the image and the perception that "off-Reservation” people have of them. They strive very hard to overcome the stereotype's assigned to them. Many times they ask our claim personnel to push the definitions in favor of the injured party(s) to avoid the appearance of not responding to the Claimant's concerns. Where the definitions allow this to occur we try to accommodate the Tribe's desires.

In conclusion, we wish to make the following points: 1. Private Insurance Industry is providing a competitive insurance

coverage for Tribal and Tribal Enterprise operations at a fair cost.


Insurance Companies can not voluntarily avail themselves of the right

July 13, 1998
Page 3

given the discretion as to whether they feel a suit is not of their
negligence and is a threat or erosion of their Sovereign status.


Creating a Federal Insurance Company is redundant as the private
insurance industry is answering the Tribes needs and exposures. Also
the FTCA is taken into consideration when pricing and policy
coverages are evaluated.


Not all Tribes need the same limits or extensions of coverages because
of their individual circumstances and needs.


Because of the increasing interaction of off-Reservation people
resulting from the economic expansion of Tribes, General Liability
should be a requirement in order to provide protection to the public for
injuries that occur as a result of negligence.

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Mr. Chairman and members of the Committee, my name is David Kwail, Chairman of the Yavapai-Apache Nation, a federally-recognizedIndian tribe in Arizona. I appreciate the opportunity to comment on S. 2097, “The Indian Tribal Conflict Resolution and Tort Claims and Risk Management Act of 1998."

We appreciate as well Chairman Campbell's effort to balance the competing interests involved. As proposed, however, S. 2097 should be considered no more than a “discussion draft,” from which the Committee may ultimately shape a meaningful solution. We believe the Committee should attempt to measure and define the problems that S. 2097 addresses before advancing such broad and unprecedented measures to solve them.

The bill tries to do too much with too little. It would create two new government agencies (the Intergovernmental Alternative Dispute Resolution Panel and the Joint Tribal-Federal-State Commission on Intergovernmental Affairs), prescribe extensive but nonbinding procedures for resolving state-tribal tax disputes, and require the Department of the Interior to conduct an exhaustive study of current tribal insurance coverage and then institute a comprehensive tribal insurance program. All of this would be required despite the lack of evidence that such steps are needed or that they are likely to be successful. Apart from broad observations about “intergovernmental harmony,” Indian “self-sufficiency and self-determination,” unspecified "conflicts involving Indian tribes,” and the benefits of alternative dispute resolution, the Findings and Purposes (§ 2) of S. 2097 cite only the difficulty of some tribes in obtaining liability insurance (not our experience) and nothing at all about taxes to support all that follows. We believe that much more should be required in the way of real evidence before this Committee undertakes a massive revision to existing laws and procedures.

In addition to being based on insufficient and speculative findings, S. 2097 attempts to deal with two separate and unrelated issues: retail taxes and tort liability. One of problems we have with Senator Gorton's S. 1691 was that it contained too many unrelated issues and, as such, was confusing and disjointed. His abandonment in favor of five separate bills, each dealing with a substantive issue, was a good idea. We suggest that the Committee, too, consider dealing with these two matters individually, so that they can be each addressed carefully and with respect.


Title II of the bill is “built backwards,” first requiring the Secretary of the Interior to provide insurance for tribes, then excepting tribes that already carry "appropriate” insurance, and then requiring the Secretary, before carrying out the requirements of section 201, (to) conduct a comprehensive survey of the degree, type and adequacy of liability insurance coverage of Indian tribes.” $ 202(a)(1)(emphasis added). Is it too much to ask that, before a new and sweeping law attempts to change the status quo, Congress and this Committee should have already determined, with some degree of particularity, the extent of the need for such change? A survey, not only of tribal insurance coverage, but also of the resolution of tribal tort claims to date, should be in order before the Committee designs a solution to a problem whose extent is not yet known. If actual problems are shown to be few, legislation (and funding!) would not be required.

The bill's Findings refer to liability coverage provided to tribes in carrying out selfdetermination contracts under Pub. L. 93-638 (the Indian Self-Determination and Education Assistance Act, 25 U.S.C. $$ 450 et seq.) (“638"). The 638 provisions are themselves far from a model of clarity. Subsection (c) of 25 U.S.C. $ 450f provides that the Secretary of the Interior will provide insurance for tribes administeringself-determinationcontracts and requires that such policies "shall contain a provision that the insurance carrier shall waive any right it may have to raise as a defense the sovereign immunity of an Indian tribe,” to the extent of the policy limits. But then Section 450n goes on to provide that “[n]othing in this subchapter [the Self-Determination Act) shall be construed as ... affecting, modifying, diminishing, or otherwise impairing the sovereign immunity from suit enjoyed by an Indian tribe.” The insurer, therefore, has greater liability than its insured, if this apparent contradiction is to make any sense at all.

To further complicate matters, non-codified amendments to the Self-Determination Act provide that, in claims arising from the performance of self-determinationcontracts, tribes are to be considered part of the Bureau of Indian Affairs or the Indian Health Service, and that such claims “shall be deemed to be an action against the United States and will be defended by the Attorney General and be afforded the full protection and coverage of the Federal Tort Claims Act.” Pub. L. 101-512, title III, § 314 (104 Stat. 1959), as amended by Pub. L. 103-138, title III, § 308 (107 Stat. 1416). This confusion of provisions would be a lawyer's dream, if only self-determination tribes controlled enough money to make it worthwhile. The Committee would do better to clarify existing law than to create further confusion by extending its provisions to a rule of general application.

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