[menog] ICANN Waives Registrar Insurance Requirement, Levels Playing Field for Registrars Globally

[Fahd Batayneh]

Friends and Colleagues,

 

The blog post at
https://www.icann.org/news/blog/icann-waives-registrar-insurance-requirement
-levels-playing-field-for-registrars-globally might be of interest to some;
especially those willing to get into the Domain Name business.

 

Thank you,

 

Fahd Batayneh

ICANN

 

 

A resolution recently approved by the ICANN Board of Directors will promote
enhanced gTLD registrar competition in the global domain name marketplace by
removing an unnecessary barrier to registrar accreditation. Since 1999, the
Registrar Accreditation Agreement (RAA) has required that registrars
maintain Commercial General Liability (CGL) insurance policies with policy
limits of at least US$ 500,000. Following 18 months of research, analysis
and community consultation, the Board determined that this type of insurance
may not serve its intended purpose of protecting registrants, and, in fact,
may have inhibited the ability of prospective registrars to become
accredited in some regions. Accordingly, on 28 September 2015 ICANN's board
resolved
<https://www.icann.org/resources/board-material/resolutions-2015-09-28-en>
that ICANN waive this requirement in all RAAs, effective immediately.

 

CGL insurance policies generally only cover certain incidents that occur on
a company's premises. Examples of qualifying events may include a customer
that is injured in an accident on the premises or an incident that occurs
due to an employee's actions. While this coverage is useful for these types
of incidents, it would not cover registrars' potentially wrongful acts, such
as failure to renew a domain name.

 

Another factor that was considered was the availability and cost of CGL
insurance globally. While it is common and readily available in some
regions, it is more difficult to find-if available at all-and significantly
more expensive in many other regions, including parts of South America and
Africa.

 

For example, a community member from Nigeria reported in a recent forum of
public comments
<http://forum.icann.org/lists/comments-raa-insurance-15jan15/msg00003.html>
that under Nigerian law businesses headquartered in that country are
required to purchase insurance coverage from Nigerian companies at a
substantial premium. Using the US dollar-to-Naira exchange rate at that
time, the ICANN-required policy limit was roughly 156.7 times the 2014
Nigerian GDP per capita or the total income of the country divided by the
number of inhabitants, giving a rough estimate of the average individual
income. By contrast, the CGL policy limit was approximately 9.2 times the
USD GDP per capita in the United States (GDP data from the World Bank
<http://data.worldbank.org/indicator/NY.GDP.PCAP.CD> ).

 

At the Board's direction, staff will begin notifying registrars of the
waiver. The Board also requested that the GNSO Council consider whether to
undertake policy work on a substitute RAA insurance requirement.

 

For more information about the impact of this decision on prospective and
existing registrars and the broader internet community, see ICANN's RAA
Insurance Waiver FAQs
<https://www.icann.org/resources/pages/raa-insurance-faqs-2015-09-30-en> .

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