Washington bills that establish legal protections for consumers in the wake of future disasters went into effect this week. The flood insurance and states of emergency bills (Senate Bill 5417 and House Bill 1566) require insurers to tell consumers that their property coverage does not include flood coverage, for example.
In the 2007 flooding in southwest Washington, which triggered nearly $45 million in claims, fewer than 8 percent of people in the affected areas had flood coverage, the Office of Insurance Commissioner said.
Now, insurers are:
- Required to inform consumers that property insurance does not cover flood damage and to tell them about the National Flood Insurance Program. Information would be provided in writing at policy inception and annually thereafter.
- Allow the Commissioner to require insurers to make reasonable exceptions, such as grace periods for payments and access to out-of-network medical care, in the event of an emergency. Authority would be limited to the insurance of people within the geographic area defined in the Governor’s declaration.
- Expand insurers’ emergency-preparedness requirements to include state and local emergencies and require domestic insurers to maintain a continuity plan in case a local, state or national emergency disrupts business operations.
For more information, visit http://www.insurance.wa.gov/legislative/documents/catastrophe.pdf.
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