Federal Legislation Pours Rein to Homeowners Insurance Market

October 29, 2024 8:18 am Published by Last week, Representative Adam Schiff (D-Calif.) introduced the Incorporating National Support for Unprecedented Risks and Emergencies (INSURE) Act1. The new legislation aims to stabilize the home insurance market in a manner that promotes adequate coverage for all, not limited to vulnerable communities1 It establishes a federal catastrophic reinsurance program to shield consumers from unrestrained cost growth, and provides insurers with an open, reasonably priced public reinsurance alternative for their worst climate-driven catastrophes.
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Schiff noted the extreme timeliness of this legislation, particularly in California where insurance costs have skyrocketed, and actually stopped writing new policies1)  
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The bill seeks to address the intersection of climate-related catastrophes and the expense of unregulated, global reinsurance1
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Enhancing Homeowners’ Access to Quality Coverage: The INSURE Act will establish a federal reinsurance program to enhance homeowners’ access to quality insurance coverage, risk reduction, loss mitigation, and community resilience1. The legislation is supported by organizations such as the Center for Economic Justice and the Consumer Federation of America1     Such groups believe that INSURE Act is a long-needed step forward in helping home owners and communities receive the ability to have affordable coverage available   Federal legislation that could reduce homeowner’s insurance premiums There are other federal legislation gaining prominence, such as Natural Disaster Reinsurance Plan from the democratic side that was introduced by Rep Jared Moskowitz2 . This bill would look to reduce insurance costs on customers in participating states through a reduction in the requirement of reinsurance purchase by insurers2 . Reinsurance is the insurance bought by an insurer from another firm to secure it against a possible massive claims event such as a hurricane. Broward County Commissioner Steve Geller has also advocated for this legislation, that is supposed to save homeowners across Florida millions of dollars down the line. A new economic impact report reports an average increase in renewal prices for home insurance within the state of Florida of a high 68% within just the last two years to establish the state as a real fast mover across America.

This plan, the Natural Disaster Reinsurance Plan, would address this by providing a more affordable alternative to the traditional reinsurance.

 
  • The INSURE Act and the Natural Disaster Reinsurance Plan are also significant efforts made by federal legislators in addressing challenges faced in the homeowners insurance market. These bills have been targeted at stabilizing the market, making it cheaper for consumers, and ensuring that vulnerable populations can access coverage.
  • As these bills wind their way through the halls of Congress, many eyes and ears will be listening, hoping and waiting to be satisfied in this legislation battle that would have far-reaching results in America’s quest to achieve less expensive homeowners’ insurance.
  • Do you agree with or do you disagree with potential federal law? Do these federal laws help problems face the homeowner’s insurance markets?
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This post was written by Trishala Tiwari

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