SB 106-HOMEOWNER/RENTER INSURANCE RENEWAL  3:36:39 PM CHAIR SPOHNHOLZ announced that the final order of business would be CS FOR SENATE BILL NO. 106(L&C), "An Act relating to renewal of insurance coverage for homeowners and renters; and providing for an effective date." 3:36:55 PM SENATOR TOM BEGICH, Alaska State Legislature, as prime sponsor, introduced CSSB 106(L&C). He paraphrased parts of the sponsor statement [included in the committee packet], which read in its entirety as follows [original punctuation provided]: Moving into a new home is one of the most significant commitments any person will ever make. Obtaining insurance to protect not only the value of that commitment, but also the invaluable belongings, and heirlooms housed within one's home, is not only prudent, but in most cases, mandated by insurance lenders. Although not mandatory, renter's insurance is recommended by the State of Alaska Division of Insurance and offers tenants similar economic protection against loss of personal property. Currently, Alaska insurance providers may fail to renew an insurance policy within the first year of coverage for any reason, including after a claim has been made. CSSB 106 would restrict insurance company's ability to not renew a policy based solely on the first claim filed within 3 years of the policy being initiated. This would ensure that one-time crime victims are not penalized by their insurance company for filing a claim. SENATOR BEGICH continued by illustrating a scenario in which an individual's insurance policy fails to be renewed by the provider because he or she filed a claim within the first year after a burglary. He said that's the power that, although rarely used, exists under the law. He reported working with the insurance industry to "narrow the scope to look at the revictimization of a victim." That, he said, is what this bill does, which is why it passed out of the Senate with no opposition and has 12 of 20 senators co-sponsoring it. 3:41:37 PM LKI TOBIN, Staff, Senator Tom Begich, Alaska State Legislature, presented a sectional analysis of the committee substitute (CS) for SB 106 [included in the committee packet] on behalf of Senator Begich, prime sponsor, which read in its entirety as follows [original punctuation provided]: Section 1: Cleans up previous language and moves notice and applicability language for nonrenewal of a personal or business insurance policy to a new section, described below. Section 2: Adds a new section prohibiting an insurance company from considering a first claim filed against the policy in the preceding three years as a reason for not renewing the policy when that claim results from a criminal act committed by a third party. The insurance company may still cancel or not renew without notice if the insurance company has manifested a good faith effort to renew the policy or the premiums on a policy are not paid. Section 3: Aligns "personal insurance" definition with AS 21.36.460(i). Section 4: Amends uncodified Alaska law so Sections 1 and 2 apply to new insurance or insurance policies renewed after the effective dates in this Act. Section 5: Amends uncodified Alaska law to allow the Director of the Division of Insurance the ability to implement new regulations outlined in Sections 1 and 2. Section 6: Gives the Director of the Division of Insurance the authority outlined in Section 5 immediately upon passage of the legislation. Section 7: All sections, save Section 6, will go into effect July 1, 2020. 3:44:41 PM REPRESENTATIVE FIELDS thanked the bill sponsor and the victims for bring this issue to the committee's attention, adding that he was not aware of it before last year. 3:45:05 PM REPRESENTATIVE RASMUSSEN questioned whether SB 106 might prompt the insurance industry to cease from insuring consumers in high- risk crime areas. SENATOR BEGICH answered no. He offered his belief that by limiting the number of years within which a first claim would have to fall, SB 106 did not create an onerous burden for the industry or the consumer. REPRESENTATIVE RASMUSSEN said she appreciates the intention behind this bill, especially for tenants who are often signing one-year leases that they may not renew. She said it seems important to have protections in place for people that are victims of crime. SENATOR BEGICH noted that nothing in the bill would prohibit an insurance company from continuing to raise rates because a claim was made, which is standard insurance practice. 3:47:19 PM REPRESENTATIVE HANNAN referenced the statutory citation in Section 2 and sought to clarify if it includes renter's insurance as well as homeowner's insurance. SENATOR BEGICH said he doesn't know. REPRESENTATIVE HANNAN asked how many states have discovered and attempted to remedy the loophole that allows insurance companies to cancel coverage if a claim is filed within the first year. SENATOR BEGICH said, "a number of states." He listed New York, Oregon, Minnesota, and offered to follow up with a document that indicates which states' statutes allow some form of this kind of law. 3:50:15 PM CHAIR SPOHNHOLZ announced that SB 106 was held over.