You are here:HomeNews CenterInsurance News2006Connecticut DOI Prohibits Insurers From Requiring Storm Shutters

Connecticut DOI Prohibits Insurers From Requiring Storm Shutters

Andover Cos. was among several insurance companies, including Allstate and Nationwide, which asked the state Department of Insurance for changes to limit their exposure...
December 12, 2006

Connecticut Insurance Commissioner Susan S. Cogswell issued new guidelines last week for companies that insure coastal homeowners, including prohibiting them from specifically requiring storm shutters.

Andover Cos. was among several insurance companies, including Allstate and Nationwide, which asked the state Department of Insurance for changes to limit their exposure to storm damage, in the wake of the two most active hurricane seasons in history in 2004 and 2005. Those proposals included raising deductibles for homes as far as three miles from the shore, gaining exclusions from wind damage claims, and raising rates, Cogswell said.

"Consumers living near the coast certainly recognize they need to take measures to protect their homes," Cogswell said in a written statement. "At the same time, we are expecting carriers to recognize when residents take these measures by reducing premiums or deductibles."

Under the newly issued guidelines, insurers may refuse to issue new policies to consumers who fail to take "appropriate mitigation measures," but they cannot cancel existing policies for that reason. For existing customers, insurers must offer them a choice, at the time of renewal, between enacting loss mitigation measures or taking on a higher deductible. If the consumer does both, then the company is required to provide a discount. Only if the consumer takes neither option may the company terminate the policy.

The Property Casualty Insurers Association of America issued a statement blasting the new guidelines as "among the most restrictive in the nation."

State Reverses Shutter Plan (New Haven Conn. Register 12/6/06)

Filed under: