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Introduced Version House Bill 2503 History

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hb2503 intr
H. B. 2503

(By Delegates Kominar, Frederick, Hartman, Long, Tabb,

Ron Thompson and H.K. White)

[Introduced February 18, 2005; referred to the Committee the Judiciary.]




A BILL to amend the code of West Virginia, 1931, as amended, by adding thereto three new sections, designated §33-17A-4a, §33- 17A-4b and §33-17A-4c, relating to providing an alternative method for nonrenewal of property insurance; manner of electing alternative method; and requiring report to the Legislature.

Be it enacted by the Legislature of West Virginia:
That the code of West Virginia, 1931, as amended, be amended by adding thereto three new sections, designated §33-17A-4a, §33- 17A-4b and §33-17A-4c, all to read as follows:
ARTICLE 17A. PROPERTY INSURANCE DECLINATION, TERMINATION AND DISCLOSURE.

§33-17A-4a. Alternative method for nonrenewal for property insurance.

(a) On or after the first day of July, two thousand five, an insurer may nonrenew a property insurance policy for any reason which is consistent with its underwriting standards.
(b) Notwithstanding any other provisions in this section, race, religion, nationality, ethnic group, age, sex, marital status, or other reason prohibited by the provisions of this chapter may not be considered as a reason for nonrenewal;
(c) Notwithstanding the provisions of section four of this article, a nonrenewal may only be issued pursuant to the provisions of this section upon notice to the named insured at least thirty days before the end of the policy period of the insurer's election not to renew the policy.
(d) Commencing the first day of July, two thousand five, the total number of nonrenewal notices issued by the insurer each year pursuant to this section, resulting in nonrenewal, may not exceed one percent per year of the total number of outstanding policies of the insurer as of the end of the previous calendar year that have been in existence for four years or longer in this state: Provided, That the total number of such nonrenewal notices issued each year to insureds within any given county in this state resulting in nonrenewal may not exceed one percent per year of the total number of the policies of the insurer in force in that county at the end of the previous calendar year: Provided, however, That an insurer may nonrenew one policy per year in any county if the applicable percentage limitation results in less than one policy.
(e) A notice issued pursuant to this section shall be delivered or sent by first class mail to the named insured at the last known address of the named insured and shall include an explanation of the specific reasons for refusal to renew. The notice shall also advise the insured of possible eligibility for coverage through the West Virginia Essential Property Insurance Association.
(f) Each insurer licensed to write property insurance policies in this state and having elected to issue all nonrenewal notices pursuant to the percentage limitations provided in this section shall file with the commissioner a copy of its underwriting standards, including any amendments or supplements. The commissioner shall review and examine the underwriting standards to ensure that they are consistent with generally accepted underwriting principles. The underwriting standards filed with the commissioner shall
be considered confidential by law and privileged, are exempt from disclosure pursuant to chapter twenty- nine-b of this code, are not open to public inspection, are not subject to subpoena, and are not subject to discovery or admissible in evidence in any criminal, civil or administrative action and are not subject to production pursuant to court order. (g) Each insurer that has elected to issue nonrenewal notices pursuant to the percentage limitations provided in this section shall report to the commissioner, on a form prescribed by the commissioner, on or before the thirtieth day of September of each year the total number of nonrenewal notices issued in this state and in each county of this state for the preceding year. The insurer shall also report to the commissioner the specific reason or reasons for the nonrenewals by county which have been issued pursuant to this section.
§33-17A-4b. Manner of making election relating to nonrenewals.
(a) Each insurer licensed to write property insurance policies in this state, as of the first day of July, two thousand five, may elect to issue all nonrenewal notices either pursuant to section four or section four-a of this article. Each insurer may notify the commissioner of its election on or before the first day of July, two thousand five, and shall remain bound by the election for a period of five years. For each subsequent five-year period each insurer shall notify the commissioner of its election to issue all nonrenewal notices either pursuant to section four or section four-a of this article. The failure of an insurer to notify the commissioner of its election by the first day of July, two thousand five, will be considered to be an election by the insurer to issue all nonrenewal notices pursuant to section four of this article and the insurer will be bound by the election for a period of five years.
(b) An insurer that is not licensed to write property insurance policies in this state as of the first day of July, two thousand five, but which becomes licensed to write such policies after that date shall, no later than four years after the date the insurer becomes licensed to write such policies, make an election to issue all nonrenewal notices either pursuant to section four or section four-a of this article, and shall notify the commissioner of its election. If the insurer elects to issue all nonrenewal notices pursuant to section four-a of this article, the total number of nonrenewals may not exceed the percentage limitations set forth in section four-a of this article. An insurer first becoming licensed to issue property insurance policies in this state after the first day of July, two thousand five, shall be bound by its election for a period of five years, and for each subsequent five-year period shall notify the commissioner of its election to issue all nonrenewal notices either pursuant to section four or section four-a of this article.
§33-17A-4c. Report to the Legislature.
By the first day of January, two thousand ten, the commissioner shall submit a report to the Legislature. The report shall contain the following:
(1) An analysis of the impact of legislation enacted during the two thousand five legislative session upon rates and insurance availability in the state;
(2) Statistics reflecting the rate history of insurers conducting business in West Virginia from the first day of July, two thousand five, until the first day of July, two thousand nine.


Note: The purpose of this bill is to allow Insurance Companies providing homeowners insurance to drop up to 1% of their customers annually; providing for registration requirements for companies that so elect; and providing that the Insurance Commissioner report back to the Legislature on the impact of this law change by 2010.
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