State Assembly Addresses Insurance Cancellations
Assemblywoman Audrey I. Pheffer has announced that the state Assembly recently passed legislation that would limit the non-renewal or cancellation of homeowner's insurance policies in our area.
"Many homeowners' are faced with difficulties in obtaining and renewing insurance policies for their property due to the unique coastal makeup of our area. This legislation is one step in helping these residents acquire the insurance that they need," said Pheffer.
Recently, area residents have received notice that their policies would not be renewed due to the possibility of storms in the area. Though insurance companies do have the right to cancel policies on such reasoning, this legislation would limit an insurer's reduction of coverage by limiting the volume of notices of intention.
Currently, an insurer may withdraw its homeowner's insurance coverage from an entire region of New York State without approaching the threshold requiring them to file a plan with the superintendent of insurance. This legislation would limit the amount an insurer could reduce its coverage of homeowners insurance policies to no more than 20% over five years or no more than 4% over twelve months per rating territory in use in this state. Rating territories are the geographical breakdowns of the state that insurance companies use to determine rates in a particular area.
The legislation also makes permanent the New York Property Insurance Underwriting Association (NYPIUA). NYPIUA, a joint underwriting association made up of insurers writing property insurance in New York, offers coverage to commercial and residential policyholders unable to obtain such coverage in the voluntary market: fire and extended coverage (such as windstorm); vandalism and malicious mischief; sprinkler leakage; loss of rent; and business interruption insurance.
NYPIUA has served as a vital economic safety net in New York, taking in a surge of new policies for properties in New York's coastal areas in the mid-1990's. More recently, NYPIUA has seen growth in new commercial policies, as it has become difficult for some businesses to obtain coverage in the voluntary market. More than 50,000 homeowners and 7,000 businesses currently insure their properties in NYPIUA.
"I am hopeful that the Senate will see the necessity and pass this legislation as soon as possible to allow these property owner's the ability to properly plan for their insurance coverage," said Pheffer.
The legislation is currently awaiting action in the Senate Insurance Committee.
For further information regarding NYPIUA, they can be reached at (212) 208-9700 or at www.nypiua.com.