The General Assembly last week passed reforms in the so-called Beach Plan, which is intended to be the insurance of last resort for coastal residents.
By Wayne Faulkner
Star News
The law:
Sets maximum wind and hail coverage in 18 coastal counties at $750,000, down from $1.5 million.
Limits coverage of contents to 40 percent of the building s value.
Sets homeowners coverage surcharges at current rates of 5 percent above so-called voluntary market rates -- rates that would be provided if coverage were part of a homeowner s policy.
Authorizes the Legislative Research Commission to study changes in the composition of the board of directors of the N.C. Insurance Underwriting Association (the industry group that manages the plan), public participation in the rate-making process, time limits for approval or disapproval by the commissioner of rate filings, and the establishment of a public advocacy staff in rate-making proceedings.
Requires that the surplus of the underwriters association be retained to pay losses, buy reinsurance, and pay operating expenses, and also provides that the surplus may not be distributed to member companies
Requires the Beach Plan to set a minimum named-storm deductible for wind and hail coverage of 1 percent of the insured value of the property
Requires the association to file a schedule of credits for policyholders based on mitigation and construction features.
Requires the association to submit to the insurance commissioner an installment plan for premium payments.
Allows the association to institute a catastrophe recovery charge on residential and commercial policyholders statewide to recover any assessment exceeding $1 billion.
Requires the N.C. Rate Bureau -- the insurance industry group that negotiates rates with the insurance commissioner -- to revise, monitor and review territories in the beach and coastal areas.
And, it changes the Beach Plan s name to the Coastal Property Insurance Pool.
Wayne Faulkner: 343-2329