NY State Insurance Department Stops Carriers from Tying Homeowners Renewals to Other Policies
The NY State Insurance Department has ordered that insurance carrier may not a refuse to renew homeowners policies based on whether a policyholder also has his or her auto insurance or other coverage with the same carrier.
Insurance Superintendent Eric R. Dinallo ordered any carrier that issued a non-renewal notice on the basis of tying in homeowners insurance to other written coverages to immediately rescind the notice. The Insurance Department mandated this order after receiving complaints from homeowners in coastal areas and were told they were not renewing as they did not have an auto or life insurance policy with that company.
In addition, legislation proposed by New York Assemblyman Robert K. Sweeney limits the number of homeowners policies that carriers can choose to not renew in a geographic region. Presently, companies are permitted to not renew up to 4% of its policies throughout New York State annually. Some feel this allows companies the ability target regions near the water, according to Sweeney.
"It would slow down their ability to non-renew on Long Island," Sweeney said.
The measure has passed the state Assembly twice, and the most recent version hasn't made it out of a state Senate committee, Sweeney said.
The bill would give more time to homeowners who've been dropped by a company to find new insurance.
"There are so many so fast, the market can't absorb it," Sweeney said of non-renewals.
Since March 2006, thousands of Long Islanders have been notified their homeowner's policies were not being renewed. More than 9,000 Suffolk homeowners and 6,500 in Nassau were dropped, according to state statistics.
Residents of Nassau and Suffolk Counties have complained to state regulators about non-renewals. Nearly half of more than 760 complaints filed with the Insurance Department between March 2006 and August 2007 came from Long Island residents, according to the statistics.
Published on August 30, 2007
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