Senate Bill S1027A

2011-2012 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

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Actions

View Actions

Date of Action	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 26, 2012	print number 1027b
Jan 26, 2012	amend and recommit to insurance
Jan 04, 2012	referred to insurance
Jun 24, 2011	recommitted to rules
Jun 13, 2011	ordered to third reading cal.1148
Jun 11, 2011	committee discharged and committed to rules
Mar 02, 2011	print number 1027a
Mar 02, 2011	amend and recommit to insurance
Jan 05, 2011	referred to insurance

Votes

- Jun 13, 2011 - Rules Committee Vote
  S1027A
  
  Aye
  
  21
  
  Nay
  
  0
  
  Aye with Reservations
  
  3
  
  Absent
  
  0
  
  Excused
  
  0
  
  Abstained
  
  0
  - - Rules Committee Vote: Jun 13, 2011
      
      aye (21)
      
      Alesi
      
      Breslin
      
      Dilan
      
      Farley
      
      Hannon
      
      Hassell-Thompson
      
      Krueger
      
      LaValle
      
      Larkin
      
      Libous
      
      Marcellino
      
      Maziarz
      
      Montgomery
      
      Nozzolio
      
      Parker
      
      Perkins
      
      Sampson
      
      Seward
      
      Skelos
      
      Smith
      
      Stewart-Cousins
      
      aye wr (3)
      
      Duane
      
      Johnson
      
      Saland

Bill Amendments

co-Sponsors

2011-S1027 - Details

See Assembly Version of this Bill:: A5215
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
2013-2014: S2338, A5312
2015-2016: S856, A6385
2017-2018: S3971, A7469

2011-S1027 - Summary

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

2011-S1027 - Sponsor Memo

                                 BILL NUMBER:  S1027

 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 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.

 SUMMARY OF SPECIFIC PROVISIONS :

Section 1: Amends Chapter 136 of the Laws of 2008 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, 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 and effectiveness in responding
to a catastrophic weather event, D) evaluating the profitability of
insurers that write homeowners' insurance in this state and the
profits or losses such insurers sustain by writing coverages along
this State's coast line, and E) 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 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 insurance needs.

This bill expands the scope of the Panel to ensure that the Insurance
Department has sufficient information so that the Department can
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 Insurance 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 is 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), in cooperation with the Department,
can create an environment that encourages more writings of homeowners
insurance in the State's coastal areas.

 PRIOR LEGISLATIVE HISTORY :
2010: S.8110 - Referred to Insurance; A.11486 - Referred to Insurance

 FISCAL IMPLICATION :
None.

 EFFECTIVE DATE :
Immediate.

2011-S1027 - Bill Text download pdf

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

                                  1027

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                               (PREFILED)

                             January 5, 2011
                               ___________

Introduced  by  Sens.  KLEIN, BRESLIN -- 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 is hereby directed to convene a
special advisory panel on homeowners' insurance/catastrophe coverage, to
examine and assess the problems affecting the availability and  afforda-
bility  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] 2010, and on an [annual] 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]
HURRICANE CATASTROPHE FUND;
  (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;

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD05019-01-1

S. 1027                             2

  (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 THE PROFITABILITY OF INSURERS THAT WRITE HOMEOWN-
ER'S INSURANCE IN COASTAL AREAS OF THIS STATE AND THE PROFITS OR  LOSSES
SUCH  INSURERS  SUSTAIN  BY WRITING COVERAGES ALONG THIS STATE'S COASTAL
AREAS. THE PANEL SHALL SPECIFICALLY ANALYZE THE REASONS WHY AND RATE  AT
WHICH INSURERS MAY BE WITHDRAWING FROM THE COASTAL HOMEOWNERS' INSURANCE
MARKET  AND  INORDINARILY  CANCELLING  SUCH  POLICIES  OR  SUBSTANTIALLY
INCREASING INSURANCE PREMIUM RATES IN SUCH MARKET.  FURTHER,  THE  PANEL
SHALL  STUDY  THE  COST  OF OBTAINING COMPARABLE REPLACEMENT HOMEOWNER'S
COVERAGE FOR THOSE INSUREDS WHO HAVE  BEEN  CANCELLED  IN  SUCH  COASTAL
AREAS.  FOR  THE PURPOSES OF THIS SUBDIVISION, THE TERM COASTAL HOMEOWN-
ERS' 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, is amended to read as follows:
  (a) The superintendent of insurance shall implement a program designed
to  attract more competitors to the state's homeowners' insurance market
PARTICULARLY WITH RESPECT TO THOSE COMMUNITIES 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.  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
  (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.

co-Sponsors

2011-S1027A - Details

See Assembly Version of this Bill:: A5215
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
2013-2014: S2338, A5312
2015-2016: S856, A6385
2017-2018: S3971, A7469

2011-S1027A - Summary

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

2011-S1027A - Sponsor Memo

                                BILL NUMBER:S1027A

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 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.

SUMMARY OF SPECIFIC PROVISIONS:
Section 1: Amends Chapter 136 of the Laws of 2008 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, 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 and effectiveness in responding
to a catastrophic weather event, 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 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 issu-
ance 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 insurance needs.

This bill expands the scope of the Panel to ensure that the Insurance
Department has sufficient information so that the Department can
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 Insurance 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 is 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), in cooperation with the
Department, can create an environment that encourages more writings
of homeowners insurance in the State's coastal areas.

PRIOR LEGISLATIVE HISTORY:
2010: S.8110 - Passed Senate; A.11486 - Referred to Insurance

FISCAL IMPLICATION:
None.

EFFECTIVE DATE:
Immediate.

2011-S1027A - Bill Text download pdf

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

                                 1027--A

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                               (PREFILED)

                             January 5, 2011
                               ___________

Introduced  by  Sens.  KLEIN, BRESLIN -- read twice and ordered printed,
  and when printed to be committed to  the  Committee  on  Insurance  --
  committee  discharged,  bill amended, ordered reprinted as amended and
  recommitted to said committee

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 is hereby directed to convene a
special advisory panel on homeowners' insurance/catastrophe coverage, to
examine and assess the problems affecting the availability and  afforda-
bility  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] 2012, and on an [annual] 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]
HURRICANE CATASTROPHE FUND;

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets

                      [ ] is old law to be omitted.
                                                           LBD05019-02-1

S. 1027--A                          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 THE REASONS WHY AND 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. FURTHER, THE PANEL SHALL STUDY  AND  ASCERTAIN  AN  AVERAGE
ESTIMATED  COST OF OBTAINING COMPARABLE 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, is amended to read as follows:
  (a) The superintendent of insurance shall implement a program designed
to attract more competitors to the state's homeowners' insurance  market
PARTICULARLY  WITH RESPECT TO THOSE COMMUNITIES 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.  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
  (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.

co-Sponsors

2011-S1027B (ACTIVE) - Details

See Assembly Version of this Bill:: A5215
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
2013-2014: S2338, A5312
2015-2016: S856, A6385
2017-2018: S3971, A7469

2011-S1027B (ACTIVE) - Summary

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

2011-S1027B (ACTIVE) - Sponsor Memo

                                BILL NUMBER:S1027B

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 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.

SUMMARY OF SPECIFIC PROVISIONS:
Section 1: Amends Chapter 136 of the Laws of 2008 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, 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 and effectiveness in responding
to a catastrophic weather event, 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 insurance needs.

This bill expands the scope of the Panel to ensure that the Insurance
Department has sufficient information so that the Department can
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 Insurance 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.s 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), in cooperation with the
Department, can create an environment that encourages more writings
of homeowners insurance in the State's coastal areas.

PRIOR LEGISLATIVE HISTORY:
2010: S.8110 - Passed Senate; A.11486 - Referred to Insurance

FISCAL IMPLICATION:
None.

EFFECTIVE DATE:
Immediate.

2011-S1027B (ACTIVE) - Bill Text download pdf

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

                                 1027--B

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                               (PREFILED)

                             January 5, 2011
                               ___________

Introduced  by  Sens.  KLEIN,  BRESLIN, SAVINO -- read twice and ordered
  printed, and when printed to be committed to the Committee  on  Insur-
  ance  --  committee  discharged,  bill  amended,  ordered reprinted as
  amended and recommitted  to  said  committee  --  recommitted  to  the
  Committee  on  Insurance  in  accordance with Senate Rule 6, sec. 8 --
  committee discharged, bill amended, ordered reprinted as  amended  and
  recommitted to said committee

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] 2013, and on an [annual] BIENNIAL basis
thereafter:

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.

                                                           LBD05019-04-2

S. 1027--B                          2

  (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]
HURRICANE CATASTROPHE FUND;
  (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 THE REASONS WHY AND 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.  FURTHER,  THE  PANEL SHALL STUDY AND ASCERTAIN AN AVERAGE
ESTIMATED COST OF OBTAINING COMPARABLE 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, is amended to read as follows:
  (a)  The superintendent of [insurance] FINANCIAL SERVICES shall imple-
ment a program designed to attract more competitors to the state's home-
owners' insurance market PARTICULARLY WITH RESPECT TO THOSE  COMMUNITIES
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.  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;

S. 1027--B                          3

  (2) adopting specific measures to  encourage  such  insurers  to  sell
homeowners' insurance in the state; and
  (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.

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Senate Bill S1027A

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Archive: Last Bill Status - In Senate Committee Insurance Committee

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Sponsored By

Jeffrey D. Klein

Archive: Last Bill Status - In Senate Committee Insurance Committee

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Neil D. Breslin

2011-S1027 - Details

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Neil D. Breslin

Diane J. Savino

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Diane J. Savino

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