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:
    1    Section 1. Subdivision 1 of section 12 of chapter 42 of  the  laws  of
    2  1996  amending the insurance law relating to homeowners' insurance and a
    3  temporary panel on homeowners' insurance coverage, as amended by chapter
    4  136 of the laws of 2008, is 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
   11  on or before November 30, [2009] 2016, and on  [an  annual]  A  BIENNIAL
   12  basis thereafter:
   13    (a)  a  review  of  FEDERAL  LEGISLATION  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.
                                                                  LBD03887-01-5
       S. 856                              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[.]; AND
   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.
   39    S 2. Subdivision (a) of section 23 of chapter 136 of the laws of  2008
   40  amending  the  insurance  law relating to extending the effectiveness of
   41  certain stand-by powers of the New York property insurance  underwriting
   42  association,  as  further amended by section 104 of part A of chapter 62
   43  of the laws of 2011, is amended to read as follows:
   44    (a) The superintendent of financial services shall implement a program
   45  designed to attract more competitors to the state's  homeowners'  insur-
   46  ance  market  PARTICULARLY  WITH  RESPECT  TO THOSE COMMUNITIES THAT ARE
   47  WITHIN ONE MILE OF A SALTWATER OCEAN, SOUND, INLET OR BAY IN  THE  COUN-
   48  TIES  OF  THE  BRONX, KINGS, NASSAU, QUEENS, RICHMOND, SUFFOLK AND WEST-
   49  CHESTER.  The program shall include, but shall not be limited to:
   50    (1) identifying, contacting and  soliciting  feedback  from  national,
   51  regional  and  other insurance carriers not currently writing homeowners
   52  insurance in the state to determine their interest in selling homeowners
   53  insurance in the state;
   54    (2) adopting specific measures to  encourage  such  insurers  to  sell
   55  homeowners' insurance in the state; and
       S. 856                              3
    1    (3)  documenting  those  issues  or concerns such insurers may cite as
    2  barriers to selling homeowners insurance in the state.
    3    S 3. This act shall take effect immediately.