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:
    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 is hereby directed to convene a
    6  special advisory panel on homeowners' insurance/catastrophe coverage, to
    7  examine and assess the problems affecting the availability and  afforda-
    8  bility  of  homeowners'  insurance  in this state and the effect thereon
    9  created by any potential major weather catastrophe.    The  panel  shall
   10  study  and  report  on  the  following  issues on or before November 30,
   11  [2009] 2012, and on an [annual] BIENNIAL basis thereafter:
   12    (a) a review of  FEDERAL  LEGISLATION  AND  other  states'  activities
   13  regarding  catastrophe related coverage, including but not limited to an
   14  evaluation of the experience under the California  Earthquake  Authority
   15  and  the  Florida  [Commission on Hurricane Loss Projection Methodology]
   16  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
    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 THE REASONS WHY AND 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. FURTHER, THE PANEL SHALL STUDY  AND  ASCERTAIN  AN  AVERAGE
   32  ESTIMATED  COST OF OBTAINING COMPARABLE REPLACEMENT HOMEOWNER'S COVERAGE
   33  FOR THOSE INSUREDS WHO HAVE BEEN CANCELLED IN SUCH  COASTAL  AREAS.  FOR
   34  THE PURPOSES OF THIS SUBDIVISION, THE TERM COASTAL HOMEOWNERS' INSURANCE
   35  MARKET  SHALL  MEAN  THOSE AREAS THAT ARE WITHIN ONE MILE OF A SALTWATER
   36  OCEAN, SOUND, INLET OR BAY IN THE COUNTIES OF THE BRONX, KINGS,  NASSAU,
   37  QUEENS, RICHMOND, SUFFOLK, AND WESTCHESTER.
   38    S  2. Subdivision (a) of section 23 of chapter 136 of the laws of 2008
   39  amending the insurance law relating to extending  the  effectiveness  of
   40  certain  stand-by powers of the New York property insurance underwriting
   41  association, is amended to read as follows:
   42    (a) The superintendent of insurance shall implement a program designed
   43  to attract more competitors to the state's homeowners' insurance  market
   44  PARTICULARLY  WITH RESPECT TO THOSE COMMUNITIES THAT ARE WITHIN ONE MILE
   45  OF A SALTWATER OCEAN, SOUND, INLET OR BAY IN THE COUNTIES OF THE  BRONX,
   46  KINGS,  NASSAU, QUEENS, RICHMOND, SUFFOLK, AND WESTCHESTER.  The program
   47  shall include, but shall not be limited to:
   48    (1) identifying, contacting and  soliciting  feedback  from  national,
   49  regional  and  other insurance carriers not currently writing homeowners
   50  insurance in the state to determine their interest in selling homeowners
   51  insurance in the state;
   52    (2) adopting specific measures to  encourage  such  insurers  to  sell
   53  homeowners' insurance in the state; and
   54    (3)  documenting  those  issues  or concerns such insurers may cite as
   55  barriers to selling homeowners insurance in the state.
   56    S 3. This act shall take effect immediately.