West Virginia Private Flood Insurance Bill Awaits Governor’s OK

The West Virginia House last Friday in a 86-8 vote passed a bill authorizing private insurers to sell flood insurance and setting out guidelines for regulation of the policies.

The bill, SB 621, had previously passed the Senate 34-0 on Feb. 21.

It now goes to Gov. Earl Ray Tomblin for his signature.

Bill sponsor Sen. Rocky Fitzsimmons and other supporters hope the bill will create some options for homeowners in the state who are now facing substantial flood insurance premium increases due to the Bigger-Waters Flood Insurance Reform Act of 2012.

According to Fitzsimmons, these increased costs are hurting the state’s housing market because people buying a new home may not be able to now afford it, he said.

The bill requires any insurer to file its flood insurance plan of operation with the commissioner, who has authority to approve the forms and regulate the rates, and it authorizes expedited processing of surplus lines policies for flood insurance.

In addition to actual cash value policies and replacement cost policies, insurers will be allowed to sell policies that cover only the outstanding amount a a home mortgage. They will also be able to restrict coverage to the principal building on a property.

If they wish, insurers will be able to exclude personal contents and additional living expenses.

Insurers would be required to notify insureds that flood insurance is available from the National Flood Insurance Program.

In other provisions, SB 621 provides that:

• An insurer may issue an insurance policy, contract or endorsement providing coverage for the peril of flood on any structure or on the contents of personal property on a form that has been filed with and approved by the commissioner and that may be substantially similar to the form used by the National Flood Insurance Program (NFIP).
• A surplus lines agent may export a contract or endorsement providing flood coverage of $1 million or more to an eligible surplus lines insurer without making a diligent effort to seek such coverage from three or more authorized insurers as is required for other business.
• An insurer may offer a flood deductible based on a stated dollar amount or a percentage of the coverage amount. At a minimum, an insurer must offer deductible amounts applicable to flood losses that equal the standard deductibles offered under the National Flood Insurance Program.

Topics Carriers Flood Virginia Oklahoma West Virginia