NY State Senate Bill 2015-S856

Senate Bill S856

2015-2016 Legislative Session

Directs the special advisory panel on homeowners' insurance/catastrophe coverage to study certain facets of insurance in coastal areas

download bill text pdf

Archive: Last Bill Status - In Senate Committee Insurance Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

Please enter your contact information

First Name

Last Name

Email Address

A valid email address is required.

Home address is used to determine the senate district in which you reside. Your support or opposition to this bill is then shared immediately with the senator who represents you.

Optional services from the NY State Senate:

Create an account. An account allows you to officially support or oppose key legislation, sign petitions with a single click, and follow issues, committees, and bills that matter to you. When you create an account, you agree to this platform's terms of participation.

Include a custom message for your Senator? (Optional)

Enter a message to your senator. Many New Yorkers use this to share the reasoning behind their support or opposition to the bill. Others might share a personal anecdote about how the bill would affect them or people they care about.

Actions

View Actions

	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 06, 2016	referred to insurance
Jan 07, 2015	referred to insurance

co-Sponsors

2015-S856 (ACTIVE) - Details

See Assembly Version of this Bill:: A6385
Current Committee:: Senate Insurance
Law Section:: Insurance
Laws Affected:: Amd §12, Chap 42 of 1996; amd §23, Chap 136 of 2008
Versions Introduced in Other Legislative Sessions:: 2009-2010: S8110, A11486
2011-2012: S1027, A5215
2013-2014: S2338, A5312
2017-2018: S3971, A7469

2015-S856 (ACTIVE) - Summary

Directs the special advisory panel on homeowners' insurance/catastrophe coverage to study certain facets of profitability of insurance in coastal areas.

2015-S856 (ACTIVE) - Sponsor Memo

                                BILL NUMBER:S856

TITLE OF BILL:

An act to amend chapter 42 of the laws of 1996 amending the insurance
law relating to homeowners' insurance and a temporary panel on
homeowners' 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
extending the effectiveness of certain stand-by powers of the New York
property insurance underwriting association, in relation to the
program designed to attract more competitors to the homeowners'
insurance market

PURPOSE OR GENERAL IDEA OF BILL:

The purpose of this bill is to expand the charge of the already
existing Temporary Panel on Homeowners' Insurance coverage (the Panel)
to devote particular attention to the market dynamics in the coastal
homeowners' insurance market and to review federal legislation, in
addition to state legislative activities regarding catastrophe related
insurance coverages. With the advent of Hurricane Irene and Superstorm
Sandy, the Financial Services Department should expand upon the number
of tasks taken on by the Temporary Panel on Homeowner's Insurance to
ensure that the homeowners market remains competitive and that
consumers have more than one or two alternatives (if they have any

alternatives at all) for obtaining homeowners' insurance, particularly
if such homeowner's policy is canceled by their current insurance
carrier.

SUMMARY OF SPECIFIC PROVISIONS:

Section 1: Amends Chapter 42 of the Laws of 1996 to expand the charge
of the Panel to include: A) reviewing federal legislative activities,
in addition to state legislative activities, related to catastrophe
related insurance coverages and the availability of federal stop loss
funds, and federal reconstruction & infrastructure financial aid
packages, B) evaluating the effectiveness of the voluntary market
assistance program with particular attention devoted to market
dynamics in the coastal homeowners insurance market, C) evaluating the
governmental capacity, such as state & local governments and special
districts, to anticipate and plan for a catastrophic weather event and
to increase the effectiveness of their efforts to respond to a
catastrophic weather event and to mitigate potential infrastructure
and Property/Casualty damages and loss, and D) looking into the
estimated cost of obtaining comparable homeowners' insurance if their
previous coverage has been cancelled.

Section 2: Amends section 23 of Chapter 136 of the Laws of 2008 to
encourage the Superintendent of Insurance Financial Services to seek
to new ways to identify new insurance carriers that may want to write
homeowners' insurance in the State's coastal areas to help replace
those carriers that are slowing withdrawing from this market.
Encouraging more private carriers to write coastal homeowners'
insurance should help to increase the availability of coastal


homeowners' insurance and give consumers more choice in this
tightening market.

JUSTIFICATION:

For more than a decade, some of New York's largest homeowner insurance
carriers have been either gradually withdrawing or curtailing the
issuance of new policies in the coastal homeowner's insurance market.
While, due to national trends related to excess liability exposure in
coastal areas, it is prudent for some of these larger carriers to
reduce their liability exposure in coastal areas, it is important that
New York homeowners are able to access a variety of insurance products
at affordable prices to cover their diverse homeowners insurance and
protection needs. This goal of expanding consumer choice and securing
the ability to obtain affordable homeowners coverage from more than
just a few insurance carriers (or no carrier at all) or obtaining
homeowners insurance from the New York Property Insurance Association
(NYPIA) has been heightened in light of the occurrence of Hurricane
Irene and Super-storm Sandy.

This bill expands the scope of the Panel to ensure that the Financial
Services Department has sufficient information so that the Department
can help to encourage other insurers to expand writings in this area
or to enter the coastal homeowners insurance market to replace, in an
orderly manner, those who are withdrawing from the market. Under
current law, insurers are required by law to notify the State
Financial Services Department of their plans to withdraw from the
market and to file a withdrawal plan. Further, insurers are encouraged
to take steps to ensure that their departure from this segment of the
market is conducted in an orderly manner to minimize the disruption
that i.e. sure to be caused by so many homeowners scrambling to secure
replacement coverage.

This bill expands the scope of the Panel so that the insurance
industry (including insurance agents, brokers and carriers in both the
admitted and non-admitted market, and reinsurers), in cooperation with
the Department, and state & local governments can create an
environment that encourages more writings of homeowners insurance in
the State's coastal areas. This bill is particularly important today,
as the market dynamics of the homeowners insurance marked may very
well change due to the catastrophic losses sustained by coastal
residents by Superstorm Sandy. This bill memo was revised in 2013 to
heighten the need to enact this bill into law in light of the events
of Superstorm Sandy. It was further amended in 2014 to revise the
dates to be used in preparing reports pursuant to this bill so that
they would be done at a later date.

PRIOR LEGISLATIVE HISTORY:

2010: S.8110 - Passed Senate; A.11486 -Referred to insurance
2012: S.1027 - Referred to Insurance Committee
2014: S.2338 - Passed Senate.

FISCAL IMPLICATIONS:

None.


EFFECTIVE DATE:

Immediate.

2015-S856 (ACTIVE) - Bill Text download pdf

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                   856

                       2015-2016 Regular Sessions

                            I N  S E N A T E

                               (PREFILED)

                             January 7, 2015
                               ___________

Introduced by Sens. KLEIN, SAVINO -- read twice and ordered printed, and
  when printed to be committed to the Committee on Insurance

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:

  Section 1. Subdivision 1 of section 12 of chapter 42 of  the  laws  of
1996  amending the insurance law relating to homeowners' insurance and a
temporary panel on homeowners' insurance coverage, as amended by chapter
136 of the laws of 2008, is amended to read as follows:
  (1) The superintendent of [insurance]  FINANCIAL  SERVICES  is  hereby
directed   to   convene   a   special   advisory  panel  on  homeowners'
insurance/catastrophe coverage,  to  examine  and  assess  the  problems
affecting the availability and affordability of homeowners' insurance in
this state and the effect thereon created by any potential major weather
catastrophe.    The panel shall study and report on the following issues
on or before November 30, [2009] 2016, and on  [an  annual]  A  BIENNIAL
basis thereafter:
  (a)  a  review  of  FEDERAL  LEGISLATION  AND other states' activities
regarding catastrophe related coverage, including but not limited to  an
evaluation  of  the experience under the California Earthquake Authority
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.
                                                           LBD03887-01-5

S. 856                              2

  (b) an evaluation of the effectiveness of any voluntary market assist-
ance program in effect in New York WITH PARTICULAR ATTENTION DEVOTED  TO
MARKET DYNAMICS IN THE COASTAL HOMEOWNERS' INSURANCE MARKET;
  (c) an evaluation of the feasibility or experience, if any, of the New
York  property  insurance  underwriting  association writing homeowners'
insurance policies or reinsuring  such  policies  when  written  in  the
voluntary market under certain market conditions;
  (d)  an  evaluation of the feasibility of the New York property insur-
ance underwriting association issuing bonds or establishing other finan-
cial mechanisms for catastrophe insurance coverage; and an evaluation of
the feasibility of establishing a state-wide catastrophe insurance fund;
  (e) an evaluation of the feasibility of the New York  property  insur-
ance underwriting association acting as a servicing carrier for policies
written  pursuant  to parts 61 and 62 of title 44 of the Code of Federal
Regulations;
  (f) an evaluation of existing state and local building codes  and  the
feasibility  of  implementing  new  building  practices  and  structural
improvement retrofitting, to mitigate damage from a major weather catas-
trophe;
  (g) an evaluation of insurer AND GOVERNMENTAL capacity and  effective-
ness  in the event of a catastrophic weather occurrence, including rein-
surance capacity and effectiveness, windstorm deductibles and multi-tier
programs, AND OTHER RISK SHARING MECHANISMS;
  (h) an evaluation of insurer preparedness in the recovery,  rebuilding
and renewal processes following weather-related losses; [and]
  (i)  an  evaluation of public awareness of storm risks and programs to
educate the public of storm risks and mitigation techniques[.]; AND
  (J) AN EVALUATION OF WHETHER AND THE RATE AT  WHICH  INSURERS  MAY  BE
WITHDRAWING  FROM  THE  COASTAL HOMEOWNERS' INSURANCE MARKET, CANCELLING
SUCH POLICIES OR SUBSTANTIALLY INCREASING  INSURANCE  PREMIUM  RATES  IN
SUCH  MARKET,  AND  THE REASONS FOR ANY SUCH ACTIONS. FURTHER, THE PANEL
SHALL STUDY AND ASCERTAIN AN AVERAGE ESTIMATED COST OF OBTAINING  COMPA-
RABLE  REPLACEMENT HOMEOWNER'S COVERAGE FOR THOSE INSUREDS WHO HAVE BEEN
CANCELLED IN SUCH COASTAL AREAS. FOR THE PURPOSES OF  THIS  SUBDIVISION,
THE  TERM  COASTAL  HOMEOWNERS'  INSURANCE MARKET SHALL MEAN THOSE AREAS
THAT ARE WITHIN ONE MILE OF A SALTWATER OCEAN, SOUND, INLET  OR  BAY  IN
THE  COUNTIES OF THE BRONX, KINGS, NASSAU, QUEENS, RICHMOND, SUFFOLK AND
WESTCHESTER.
  S 2. Subdivision (a) of section 23 of chapter 136 of the laws of  2008
amending  the  insurance  law relating to extending the effectiveness of
certain stand-by powers of the New York property insurance  underwriting
association,  as  further amended by section 104 of part A of chapter 62
of the laws of 2011, is amended to read as follows:
  (a) The superintendent of financial services shall implement a program
designed to attract more competitors to the state's  homeowners'  insur-
ance  market  PARTICULARLY  WITH  RESPECT  TO THOSE COMMUNITIES THAT ARE
WITHIN ONE MILE OF A SALTWATER OCEAN, SOUND, INLET OR BAY IN  THE  COUN-
TIES  OF  THE  BRONX, KINGS, NASSAU, QUEENS, RICHMOND, SUFFOLK AND WEST-
CHESTER.  The program shall include, but shall not be limited to:
  (1) identifying, contacting and  soliciting  feedback  from  national,
regional  and  other insurance carriers not currently writing homeowners
insurance in the state to determine their interest in selling homeowners
insurance in the state;
  (2) adopting specific measures to  encourage  such  insurers  to  sell
homeowners' insurance in the state; and

S. 856                              3

  (3)  documenting  those  issues  or concerns such insurers may cite as
barriers to selling homeowners insurance in the state.
  S 3. This act shall take effect immediately.

Comments

Open Legislation is a forum for New York State legislation. All comments are subject to review and community moderation is encouraged.

Comments deemed off-topic, commercial, campaign-related, self-promotional; or that contain profanity, hate or toxic speech; or that link to sites outside of the nysenate.gov domain are not permitted, and will not be published. Attempts to intimidate and silence contributors or deliberately deceive the public, including excessive or extraneous posting/posts, or coordinated activity, are prohibited and may result in the temporary or permanent banning of the user. Comment moderation is generally performed Monday through Friday. By contributing or voting you agree to the Terms of Participation and verify you are over 13.

Create an account. An account allows you to sign petitions with a single click, officially support or oppose key legislation, and follow issues, committees, and bills that matter to you. When you create an account, you agree to this platform's terms of participation.

Senate Bill S856

Share this bill

Sponsored By

Jeffrey D. Klein