TITLE 27

Insurance

CHAPTER 27-76

Weather Related Losses

SECTION 27-76-2



   § 27-76-2  Hurricane deductibles, triggers

and policyholder notice. –

(a) The provisions of this section shall be applicable to policies issuing or

renewing on or after July 1, 2008.



   (b) In all instances where an insurance company licensed to

do business in this state offers or includes any deductible and/or mitigation

measure related to such deductible for any type of personal lines residential

property insurance on dwelling houses, the insurance company shall provide

prominent and clear notice to insureds that shall be included in the policy

issuance or renewal package and shall fully disclose all details pertaining to

any such deductible and/or mitigation measure.



   (c) The insurer may apply a deductible specific to windstorm

coverage where:



   (1) The deductible is specifically approved by the director

and shall not exceed five percent (5%) of the insured value.



   (2) The deductible shall be applicable to losses due to a

hurricane during the period commencing with the issuance of a hurricane-warning

bulletin for any part of the state by the National Hurricane Center and

concluding twenty-four (24) hours after the termination of the last hurricane

warning bulletin for any part of the state.



   (3) The deductible, whether it is a flat dollar deductible or

a percentage deductible shall be presented by at least two (2) examples that

illustrate the application of the deductible to the insured. Nothing herein

shall prohibit the insurer from providing any additional information to the

insured to assist in the insured's understanding of the deductible to be

applied to the insured's policy.



   (4) The deductible set forth above shall not be applied to

any insured, if the insured has installed approved mitigation measures to

protect against windstorm damage and the insurer has either inspected the

property or the insured has submitted satisfactory proof of installation of the

approved mitigation measures. The insurance commissioner, in consultation with

the state building code commissioner, shall adopt and may amend or revise a

list of mitigation measures, based so far as reasonably feasible on national

standards for such measures and practices in other comparable states. The list

of mitigation measures adopted by the insurance commissioner shall be

considered approved mitigation measures for purposes of this subdivision.



   (5) For the application of the hurricane deductible on Block

Island, losses are due to a hurricane when a hurricane results in hurricane

force sustained winds as reported by the national weather service for Block

Island. For the application of the hurricane deductible in the remainder of the

state, losses are due to a hurricane when a hurricane results in hurricane

force sustained winds as reported by the national weather service for any other

location in the state. All terms are as defined by the national weather service.



   (d) Premium credits shall be applied to policies with

deductibles as set forth in subsection 27-76-2(c).



   (e)(1) An insurer may require mitigation measures to protect

against windstorm damage only after specific approval of the substance of such

mitigation measures by the director;



   (2) Mitigation measures to be taken by an insured are clearly

explained, including a complete illustration of the dollar impact upon the

premiums to be charged to insureds if the requested mitigation activities are

undertaken;



   (3) No mandatory deductible for windstorm damage shall be

included in the policy;



   (4) An insurer shall write the requested coverage at the

premium rate that includes the premium credit to be realized with the

completion of the mitigation efforts;



   (5) The insurer shall affirmatively state the length of time

during which discount given for the mitigation efforts will apply; and



   (6) No insurer shall subsequently non-renew an insured who

has taken the mitigation steps requested by the insurer for reasons of the

insurers exposure to catastrophe loss, unless for non-payment of premium,

fraud, breach by the insured of a provision of the policy, reversal or a lack

of maintenance of the mitigation steps, or insurer solvency concerns or adverse

loss history.



   (f) Penalties for failure to comply with the provisions of

this section shall be administered by the director in accordance with the

provisions of § 42-14-16.



   (g) The department of business regulation shall have

authority to adopt such rules, including emergency rules, as may be necessary

or desirable to effectuate the purposes of this section.



History of Section.

(P.L. 2012, ch. 64, § 2; P.L. 2012, ch. 83, § 2.)