A coalition of 14 major U.S.-based insurance groups is touting the benefits of proposed legislation to close a loophole allowing foreign-based insurers to strip income into tax havens.

The Coalition For A Domestic Insurance Industry is fighting the disparity in that U.S.-based insurers must pay current tax on all of their income from providing coverage for U.S. risk.

By contrast, the group says, the loophole in current law allows foreign-based groups to strip their income from writing U.S. insurance into tax havens, thereby avoiding billions of dollars of U.S. taxes annually.

The coalition, with more than 150,000 employees and total assets in excess of $1 trillion with offices and employees located throughout the U.S., said in a statement said legislation is “essential to eliminate this unfair tax advantage that forces the American taxpayer to subsidize tax haven insurers operating in the U.S. market at the expense of U.S.-owned insurers and their workers.”

In response to a report, issued by the Brattle Group, suggesting that proposed legislation to remove the loophole would be punitive to foreign-based insurers and hurt the U.S. insurance marketplace, the group said the conclusions were “untrue and do not reflect marketplace realities.”

The target of the bill — excessive related party reinsurance transactions – adds no additional capacity to the market, but rather requires a mere bookkeeping entry to move premium from the U.S. company’s books to the foreign parent’s books, the coalition said.

The Coalition For A Domestic Insurance Industry includes: AMBAC Financial Group, New York, N.Y.; American Financial Group, Cincinnati, Ohio; Berkshire Hathaway, Omaha, Neb.; The Chubb Corp., Warren, N.J.; EMC Insurance Cos., Des Moines, Iowa; The Hartford Financial Services Group, Hartford, Conn.; Liberty Mutual, Boston, Mass.; Markel Insurance Co., Glen Allen, Va; MBIA Insurance Corp., Armonk, N.Y.; Safeco Corp. (a Liberty Mutual subsidiary), Seattle, Wash.; Scottsdale Insurance Co. (a Nationwide subsidiary), Scottsdale, Ariz.; The Travelers Cos., St. Paul, Minn.; W. R. Berkley Corp., Greenwich, Conn. and Zenith Insurance Co., Woodland Hills, Calif.