BILL NUMBER:  S6493

 TITLE OF BILL :  An act to amend the insurance law, in relation to
reduction in rates of property/casualty insurance on residential
property for insureds who complete an approved homeowner natural
disaster preparedness, home safety and loss prevention course

 PURPOSE OF BILL :

The purpose of this bill is to provide for an actuarially appropriate
reduction in homeowners insurance and insurance that covers property
damage for condominiums, cooperative residential units and for renters
caused by a catastrophic natural disaster or other insurable events. A
residential property owner could obtain such an actuarially
appropriate premium reduction upon completion of a natural disaster
preparedness, home safety and loss prevention course that is approved
by the Superintendent of the Financial Services Department.

The goal of the bill is to raise the awareness of natural disaster
preparedness and losses by other insurable events by offering such a
course for residential property owners. The ultimate goal being to
help reduce the risk exposure faced by property owners from damage
caused by a wide spread natural disaster such as a hurricane, ice
storm, flood, tornado, or other catastrophic disasters caused by
nature or by other insurable events such as fire, theft, burglary,
personal injury or property damage.
              

 SUMMARY OF SPECIFIC PROVISIONS :

Section 1: Legislative intent.

Section 2: Amends Insurance Law section 2346 to add a new subsection
(5) that provides for this actuarially appropriate reduction in
homeowners insurance and for others who live in condominiums,
cooperates, or are renters.

-Provides for a definition of "completion certificate", "natural
disaster", "homeowner natural disaster preparedness, home safety and
loss prevention course", and "applicant" who applies for permission
and approval to conduct such a class from the Superintendent.

-Authorizes the Superintendent of Financial Services to provide for an
actuarially appropriate reduction on residential property insurance
premiums for a period of 3 years upon the completion of a homeowner
natural disaster preparedness, home safety and loss prevention course.
The Superintendent may also provide for an actuarially appropriate
reduction in premium rates for the installation of equipment, devices,
or other capital improvements that can help to eliminate or mitigate
natural disaster damage or losses from other insurable events.

-Such coarse, after being submitted for approval to the Superintendent
by an applicant, such as a property/casualty insurer or a private
entity that conducts such risk management classes, shall provide
useful information related to courses of action that can be taken by a
homeowner before, during and after the occurrence of a natural
disaster; strategies to reduce risk exposure to residential property
owners, and information on the kinds of equipment, devices and other
capital improvements made to real property to help reduce the risk of
damage to real property, personal injury or loss of life. The emphasis
of the course is to be on reducing the risk of damage from
catastrophic events such as natural disasters, but it shall also
include information about increasing home safety and other loss
prevention techniques.

-The insurer would provide for the reduction in insurance premiums
upon completion of 'such a natural disaster preparedness, home safety
and loss prevention course. A completion certificate would need to be
issued by the approved natural disaster preparedness course sponsor,
be it the insurer, agent of the insurer or an approved private company
that conducts such class and submitted to the insurance carrier.

-The Superintendent may establish standards and guidelines to guide
course sponsor applicants on the kinds of homeowner natural disaster
preparedness, home safety and loss prevention courses that will be
approved.

 JUSTIFICATION :

Over the last decade or so, it seems that more and more catastrophic
weather events have struck the Northeastern portions of the United
States. The purpose of this bill is to encourage homeowners to take a
natural disaster preparedness course to help reduce the risk of
property damage, personal injury, and loss of life that can occur as
the result of these increasingly catastrophic weather events. In
addition, by encouraging residential property owners to take such a
class, it is the sponsor's hope to help reduce the economic and
personal injuries that occur due to these catastrophic weather events.
In addition, such course, to increase the cost savings to consumers
and insurance carriers can include items related to home safety and
other loss prevention techniques.

This bill will not adversely affect insurers, in that they would only
need to give an actuarially appropriate premium reduction that is
demonstrated to reflect real potential property/casualty losses that
could be curbed. Further, this is not a mandate bill in that only
those insurers that wish to offer the course or sanction such a course
provided for by an approved private vendor to provide for such a
premium reduction would need to participate in the program.  New York
State law already provides for an actuarially appropriate reduction on
auto insurance rates to those that take a defensive driving course.
This bill merely extends this concept of providing for a risk
management class and risk aversion class to homeowners' insurance.
Also, as is the case with the driver safety auto insurance premium
reduction course that is already in state law, such premium reduction
is for a three year period of time.

Further, pursuant to Insurance Law section 2346, the law already
provides for an actuarially appropriate reduction in homeowners
insurance if such homeowner specifically installs stand alone
equipment, including, but only exclusively, a sprinkler system,
dead-bolts or hurricane storm shutters or hurricane resistant
laminated glass windows or doors. This bill merely adds to this list
of equipment that can help to reduce the risk exposure to a natural
disaster with addition of a class to reduce potential damages, the
same as is now the case for those who take the defensive driving
class.In a somewhat similar bill S.1529 / A.6846, that passed both
houses of the Legislature in 2015, but was vetoed, the sponsors
maintain that this concept of a natural disaster preparedness course
is not covered under the current law. However, this bill was altered
to make it very clear that the bill is making it very clear that this
kind of class and premium reduction can be put into effect.

 LEGISLATIVE HISTORY :

New Bill, but somewhat similar to S. 1529 / A. 6846 that was vetoed in
2015.

 FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS :

None.

 EFFECTIVE DATE :
January first, next succeeding when the law shall have gone into
effect.