The association currently acts as the state's Fair Access to Insurance Requirements (FAIR) plan, providing residual market for fire, windstorm and extended property coverage.

In a statement, Mr. Serio said the department is holding the hearings to address concerns voiced by businesses and other organizations that say they cannot secure the appropriate insurance coverage.

Within the insurance community, the idea does not appear to have much support. Insurance professionals who were interviewed said the answer is not opening NYPIUA to commercial liability, but doing away with the state's strict liability law.

The law, known as Section 240 and 241 scaffolding law, holds property owners wholly liable for any injuries resulting in or around a scaffolding site. The injuries are not covered under workers' compensation provisions, they said, and are costing insurers substantial amounts in unrestricted claims.

"We don't think it is a good idea," said Thomas J. Derella, president of The Kingstar Company Inc., in Kingston, N.Y. "We applaud the superintendent's efforts to find market relief, but the real answer is to fix the labor law."

Mr. Derella, who is also the president of the Professional Insurance Agents of New York, said besides fixing the labor laws, NYPIUA lacks the underwriting experience to price risks adequately. He also feels that, for the long term, opening the risk to the residual market would create more capacity problems because existing carriers would not want to compete with NYPIUA. This would, in turn, create harder market conditions in the line than exist today.

John Buckley, executive vice president of NIF Services of New York, a managing general agency based in New York City, noted that without the labor reforms the residual market would face the same difficulties and expensive claims history that traditional carriers are facing today.

"It is a short-term setup for disaster," said Mr. Buckley.

"We are concerned that this is a Band-Aid approach," said Kathleen Weinheimer, vice president of industrial relations for the Independent Insurance Agents & Brokers of New York. "We feel that this is not a way to address the issue permanently. Our basic message is that this is not the right approach."

Ms. Weinheimer said the association, which is preparing to speak at one of the public hearings, fears such an approach could drive carriers in that market out of the state due to the residual market assessments.

If the labor laws were reformed, she suggested, it would allow for the needed capacity in the market, a point echoed by Mr. Derella.

In a statement, Bernard N. Bourdeau, president of the New York Insurance Association, a carrier trade association, said there is no capacity problem. The problem is affordability. That is the direct result of the strict liability laws. What capacity is not availability in the standard market can be filled by the nonadmitted market, he said.

He said until reforms take place, coverage would remain "very available, but very expensive."