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S03971 Summary:

BILL NOS03971
 
SAME ASSAME AS A07469
 
SPONSORKLEIN
 
COSPNSRAVELLA, SAVINO
 
MLTSPNSR
 
Amd 12, Chap 42 of 1996; amd 23, Chap 136 of 2008
 
Directs the special advisory panel on homeowners' insurance/catastrophe coverage to study certain facets of profitability of insurance in coastal areas.
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S03971 Actions:

BILL NOS03971
 
01/31/2017REFERRED TO INSURANCE
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S03971 Memo:

Memo not available
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S03971 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          3971
 
                               2017-2018 Regular Sessions
 
                    IN SENATE
 
                                    January 31, 2017
                                       ___________
 
        Introduced  by  Sens.  KLEIN,  AVELLA,  SAVINO -- read twice and ordered
          printed, and when printed to be committed to the Committee  on  Insur-
          ance
 
        AN  ACT  to  amend chapter 42 of the laws of 1996 amending the insurance
          law relating to homeowners' insurance and a temporary panel  on  home-
          owners'  insurance coverage, in relation to the special advisory panel
          on homeowners' insurance/catastrophe coverage; and  to  amend  chapter
          136 of the laws of 2008 amending the insurance law relating to extend-
          ing the effectiveness of certain stand-by powers of the New York prop-
          erty  insurance  underwriting  association, in relation to the program
          designed to attract more  competitors  to  the  homeowners'  insurance
          market
 
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
 
     1    Section 1. Subdivisions 1 and 2 of section 12 of  chapter  42  of  the
     2  laws  of  1996 amending the insurance law relating to homeowners' insur-
     3  ance and a temporary panel on homeowners' insurance coverage, as amended
     4  by chapter 136 of the laws of 2008, are amended to read as follows:
     5    (1) The superintendent of [insurance]  financial  services  is  hereby
     6  directed   to   convene   a   special   advisory  panel  on  homeowners'
     7  insurance/catastrophe coverage,  to  examine  and  assess  the  problems
     8  affecting the availability and affordability of homeowners' insurance in
     9  this state and the effect thereon created by any potential major weather
    10  catastrophe. The panel shall study and report on the following issues on
    11  or  before November 30, [2009] 2018, and on [an annual] a biennial basis
    12  thereafter:
    13    (a) a review of international, federal and  other  states'  activities
    14  regarding  catastrophe related coverage, including but not limited to an
    15  evaluation of the experience under the California  Earthquake  Authority
    16  and the Florida Commission on Hurricane Loss Projection Methodology;
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD09368-01-7

        S. 3971                             2
 
     1    (b) an evaluation of the effectiveness of any voluntary market assist-
     2  ance  program in effect in New York with particular attention devoted to
     3  market dynamics in the coastal homeowners' insurance market;
     4    (c) an evaluation of the feasibility or experience, if any, of the New
     5  York  property  insurance  underwriting  association writing homeowners'
     6  insurance policies or reinsuring  such  policies  when  written  in  the
     7  voluntary market under certain market conditions;
     8    (d)  an  evaluation of the feasibility of the New York property insur-
     9  ance underwriting association issuing bonds or establishing other finan-
    10  cial mechanisms for catastrophe insurance coverage; and an evaluation of
    11  the feasibility of establishing a state-wide catastrophe insurance fund;
    12    (e) an evaluation of the feasibility of the New York  property  insur-
    13  ance underwriting association acting as a servicing carrier for policies
    14  written  pursuant  to parts 61 and 62 of title 44 of the Code of Federal
    15  Regulations;
    16    (f) an evaluation of existing state and local building codes  and  the
    17  feasibility  of  implementing  new  building  practices  and  structural
    18  improvement retrofitting, to mitigate damage from a major weather catas-
    19  trophe;
    20    (g) an evaluation of insurer and governmental capacity and  effective-
    21  ness  in the event of a catastrophic weather occurrence, including rein-
    22  surance capacity and effectiveness, windstorm deductibles and multi-tier
    23  programs, and other risk sharing mechanisms;
    24    (h) an evaluation of insurer preparedness in the recovery,  rebuilding
    25  and renewal processes following weather-related losses; [and]
    26    (i)  an  evaluation of public awareness of storm risks and programs to
    27  educate the public of storm risks and mitigation techniques[.];
    28    (j) an evaluation of whether and the rate at  which  insurers  may  be
    29  withdrawing  from  the  coastal homeowners' insurance market, cancelling
    30  such policies or substantially increasing  insurance  premium  rates  in
    31  such  market,  and  the reasons for any such actions. Further, the panel
    32  shall study and ascertain an average estimated cost of obtaining  compa-
    33  rable  replacement homeowner's coverage for those insureds who have been
    34  cancelled in such coastal areas. For the purposes of  this  subdivision,
    35  the  term  coastal  homeowners'  insurance market shall mean those areas
    36  that are within one mile of a saltwater ocean, sound, inlet  or  bay  in
    37  the  counties of the Bronx, Kings, Nassau, Queens, Richmond, Suffolk and
    38  Westchester; and
    39    (k) an evaluation of state and local municipal natural disaster  miti-
    40  gation  plans, as provided for in article two-B of the executive law, as
    41  they relate to minimizing property damage to residential homes in  coas-
    42  tal  areas  of the state and suggest ways to minimize insurable and non-
    43  insurable residential home  losses  due  to  such  catastrophic  natural
    44  disaster events.
    45    (2)  The panel shall consist of [twenty-three] twenty-six members. The
    46  superintendent of [insurance] financial services shall be the  chair  of
    47  the  panel.  The  other  [twenty-two]  twenty-five  members shall be the
    48  director of the state emergency management office, the state chief  risk
    49  officer,  the director of risk and insurance management of the office of
    50  general services, and  twenty-two  members  appointed  as  follows:  six
    51  members shall be appointed by the governor, of whom two shall be experts
    52  in the field of catastrophic meteorological science, two shall be build-
    53  ing  or  code  enforcement  officials and two shall be representative of
    54  insurance consumers; six members shall be  appointed  by  the  temporary
    55  president  of  the  senate,  of  whom  three  shall be representative of
    56  producers actively placing homeowner's insurance policies in this state,

        S. 3971                             3
 
     1  two shall be representative  of  insurance  companies  actively  writing
     2  homeowner's  insurance policies in this state and one shall be represen-
     3  tative  of  insurance  companies  providing  reinsurance  coverage;  six
     4  members shall be appointed by the speaker of the assembly, of whom three
     5  shall be representative of producers actively placing homeowner's insur-
     6  ance  policies in this state and three shall be representative of insur-
     7  ance companies actively writing homeowner's insurance policies  in  this
     8  state; and two members each shall be appointed by the minority leader of
     9  the  senate  and  the  minority  leader of the assembly, provided of the
    10  members appointed by each minority leader one shall be representative of
    11  producers actively placing homeowner's insurance policies in this  state
    12  and  one shall be representative of insurance companies actively writing
    13  homeowner's insurance policies in this state.  Each member of the  panel
    14  shall serve at the pleasure of the official who appointed him or her.
    15    §  2. Subdivision (a) of section 23 of chapter 136 of the laws of 2008
    16  amending the insurance law relating to extending  the  effectiveness  of
    17  certain  stand-by powers of the New York property insurance underwriting
    18  association, as further amended by section 104 of part A of  chapter  62
    19  of the laws of 2011, is amended to read as follows:
    20    (a) The superintendent of financial services shall implement a program
    21  designed  to  attract more competitors to the state's homeowners' insur-
    22  ance market particularly with respect  to  those  communities  that  are
    23  within  one  mile of a saltwater ocean, sound, inlet or bay in the coun-
    24  ties of the Bronx, Kings, Nassau, Queens, Richmond,  Suffolk  and  West-
    25  chester.  The program shall include, but shall not be limited to:
    26    (1)  identifying,  contacting  and  soliciting feedback from national,
    27  regional and other insurance carriers not currently  writing  homeowners
    28  insurance in the state to determine their interest in selling homeowners
    29  insurance in the state;
    30    (2)  adopting  specific  measures  to  encourage such insurers to sell
    31  homeowners' insurance in the state; and
    32    (3) documenting those issues or concerns such  insurers  may  cite  as
    33  barriers to selling homeowners insurance in the state.
    34    § 3. This act shall take effect immediately.
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