Albany, NY Assembly Insurance Committee Chair Kevin Cahill (D Ulster, Dutchess) announced that a package of bills passed the Assembly on Tuesday. The group of bills addresses a number of issues that arose during a hearing and a series of roundtables in the wake of Hurricane Sandy. Among the thirteen bills designed to strengthen consumer protections in the event of a disaster is Speaker Silvers Homeowners Bill of Rights which would require insurers to provide consumers with information on flood zones and flood insurance coverage. It would also require the Department of Financial services to develop a Consumers Guide on Insuring Against Catastrophic Loss.
After the floodwaters receded and insurance claims were filed another wave of trouble hit those living near the coast: delayed or denied claims. In response to this secondary tragedy, I conducted a series of hearings and roundtables to determine what needed to be done to help those affected and to prevent these events in the future. Im proud to say that this package works toward addressing the concerns raised in those extensive conversations, said Cahill.
At a time when so many families and businesses are still struggling to rebuild from Sandy, I hear far too often about the painstaking, complex processes so many people have had to go through to even get their insurance companies on the phone, let alone begin filing claims or receive any actual assistance. Community members should be able to focus on recovery without the additional burden of dealing with unresponsive, unreliable or overwhelmed insurance companies. This legislative package reforms multiple aspects of the lengthy insurance process, but most importantly, it ensures that insurance companies are accountable to the homeowners and businesses they represent, said Assembly Speaker Sheldon Silver.
The bills were sponsored by Assemblymember Cahill himself and Speaker Sheldon Silver (D-Manhattan) along with other members whose communities were hard hit including: Assemblymembers James Skoufis (D-Woodbury), William Colton (D-Brooklyn), Harvey Weisenberg (DLong Beach), Matthew Titone (D-Staten Island), Helene Weinstein (D-Brooklyn), Robert Sweeney (D-Lindenhurst), Francisco Moya (D-Queens), Phillip Goldfeder (D-Queens), and Alec Brook-Krasny (DBrooklyn).
Assemblymember Skoufis bills establishes a task force on the insurance industries response to disasters and addressed the need for claims to be processed quicker. When Hurricane Irene hit our community in 2011, many families and businesses were destroyed and left waiting and held in limbo for months on end by the same insurance companies that were supposed to be helping them rebuild. When Sandy hit, many communities in New York were left feeling the same way abandoned and forgotten by their insurance companies. This legislation amends that unjustifiable problem and ensures that insurance companies respond to claims in a timely and efficient manner, said Skoufis.
Assemblymember Coltons bill requires that insurers provide discounts to those who complete home safety and loss prevention courses. "Individuals and families should have incentives to invest in disaster training so theyre prepared to protect their loved ones and property. Knowing what to do in an emergency can save lives and vital resources, said Colton.
Assemblymember Weisenbergs bill establishes uniform standards for what would trigger a hurricane windstorm deductible. In April of 2012, the Assembly overwhelmingly approved my bill, yet the Senate failed to act. At that time, I cautioned that we could not afford another hurricane season without basic standards and guidelines for the underwriting of windstorm policies. Six months later, Sandy visited our shores. The passage of this bill would have prevented at least one confusing obstacle so many homeowners faced during our attempts to rebuild, said Weisenberg.
Assemblymember Titones bill establishes an expedited process for lawsuits against insurance companies that stem from a declared disaster or emergency. Many families and business property owners have sustained massive financial ruin in the wake of our states recent natural disasters and have been left waiting for months, and even years, before receiving assistance from insurance companies. Such a lengthy wait is unacceptable. The bill I sponsored will help affected parties seek an immediate and definite resolution of their claims against unresponsive insurers in court, said Titone.
Assemblymember Weinsteins bill establishes a private right of action for unfair claim settlement practices when a declared emergency has occurred. While insurers have the right to reasonably deny a consumers insurance claims, oftentimes they end up taking advantage of businesses or homeowners who have lost everything. We saw this just last year with Hurricane Sandy when many homeowners were placed in unrealistic situations by their insurers after simply trying to claim benefits they were entitled to. The legislation I sponsored amends this wrongdoing and will help ensure that those who are entitled to certain insurance benefits as a result of devastating storm damage receive them and are treated fairly by their insurance companies, said Weinstein.
Assemblymember Sweeneys bill restricts how many homeowners policies an insurer can non-renew in order to prevent insurers from withdrawing from the coastal market. Following a major disaster such as Superstorm Sandy, insurers often withdraw from the coastal markets, placing large numbers of homeowners on the market at one time. This not only disrupts the market, but places a strain on policyholders, many of whom are still recovering from the disaster. Under current law, an insurance company can drop homeowners in an entire region, causing policy costs to skyrocket for those who are lucky enough to be able to obtain replacement coverage. This is poor policy and must be changed, said Sweeney.
Assemblymember Moyas bill prevents insurers from denying business interruption claims for losses that are covered under a policy simply because those losses were caused by an event that wasnt covered such as a flood. "When Hurricane Sandy hit our region, countless businesses experienced severe damage and a subsequent loss of productivity due to power outages and other storm-related destruction, but were frustratingly denied claims by insurers, who noted the damages were often caused however indirectly by flooding, a stipulation normally excluded from business interruption coverage. This is unacceptable and entirely unfair, which is why the bill I sponsored gives these businesses a right to pursue claims on relevant natural disaster-related damages and helps alleviate some of the burden of their storm-recovery efforts, said Moya.
Assemblymember Goldfeders bill would prohibit insurers from denying claims for losses that are covered under the policy, like wind damage, because a separate risk which was not covered, like a flood, occurred at the same time. After 85% of my district, including my own home was destroyed during Super-Storm Sandy, many homeowners weren't aware of the next steps and blindly approached their insurance companies. Thousands of families and small businesses were unprepared for a natural disaster and had not been educated on what insurance coverage they owned. This legislation will not only help educate our families and small businesses, but will better prepare and strengthen our communities for the future," said Goldfeder
Inevitability, another disaster like Sandy will occur in New York State. Although the location and timing of the next event may be unknown, the states property and casualty insurance laws must be updated in order to protect consumers in the aftermath. I urge my Senate colleagues to take action on these bills as soon as possible, said Assemblymember Cahill.