REPORT TITLE:
HHRF


DESCRIPTION:
Provides matching grants to homeowners installing hurricane
mitigation devices.  Clarifies the circumstances under which
standard extended coverage endorsements qualify as comparable
coverage for purposes of levying assessments on property
insurance premiums.  (SD2)

 
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                                                        2314
HOUSE OF REPRESENTATIVES                H.B. NO.           H.D. 1
TWENTIETH LEGISLATURE, 2000                                S.D. 2
STATE OF HAWAII                                            
                                                             
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                   A  BILL  FOR  AN  ACT

RELATING TO INSURANCE.



BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 1      SECTION 1.  Section 431P-10, Hawaii Revised Statutes, is
 
 2 amended by amending subsection (b) to read as follows:
 
 3      "(b)  Upon the authorization of the commissioner, insurers
 
 4 may provide standard extended coverage endorsements[,] for
 
 5 residential property, including coverage of hurricane risks,
 
 6 subject to the fund's program for incentives and credits;
 
 7 provided that in the absence of such authorization no other
 
 8 policy of residential property insurance or endorsement to a
 
 9 policy of residential property insurance on eligible residential
 
10 property located in this State shall be issued to provide
 
11 insurance for damages or losses caused by a covered event if such
 
12 coverage is less than that offered by the fund.  If standard
 
13 extended coverage endorsements on commercial property are no
 
14 longer being offered by the fund, any standard extended coverage
 
15 endorsements on commercial property offered by an insurer shall
 
16 qualify as a comparable coverage under section 431P-5(b)(8)(A).
 
17 Standard extended coverage endorsements on residential property
 
18 which include coverage for hurricane losses offered by an insurer
 
19 shall qualify as a comparable coverage under section
 

 
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                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        

 
 1 431P-5(b)(8)(A)."
 
 2      SECTION 2.  Section 431P-12, Hawaii Revised Statutes, is
 
 3 amended to read as follows:
 
 4      "[[]§431P-12[]]  Mitigation.  (a)  The fund shall develop a
 
 5 comprehensive loss reduction plan for the hurricane peril.  The
 
 6 plan shall include standards for new residential and commercial
 
 7 structures and separate standards for existing residential and
 
 8 commercial structures.  The plan shall provide a timetable for
 
 9 implementation of mandatory loss mitigation measures for both new
 
10 and existing structures. 
 
11      (b)  In addition to any plan under subsection (a), beginning
 
12 with calendar year January 1, 2000, and each calendar year
 
13 thereafter, the board shall set aside an amount equal to five per
 
14 cent of the amount remaining after deducting any outstanding
 
15 liabilities from the hurricane reserve trust fund; provided that
 
16 the moneys set aside shall not be less than $700,000, and not
 
17 more than $5,000,000.
 
18      (c)  Moneys set aside in the fund under subsection (b) shall
 
19 be used for the purpose of providing matching grants to
 
20 policyholders under the fund who:
 
21      (1)  On or after January 1, 2000, properly install fund-
 
22           approved:
 
23           (A)  Wind resistive devices; or
 

 
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Page 3                                                     2314
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        

 
 1           (B)  Opening protection coverings for all plate and
 
 2                sliding glass openings larger than two by two feet
 
 3                that are installed along with sufficient single,
 
 4                double, and garage door retention devices, as
 
 5                applicable; and
 
 6      (2)  Pay any established fees to offset the administrative
 
 7           and marketing costs of the grant program.
 
 8 Each policyholder is eligible to receive a grant up to $3,500, on
 
 9 a dollar for dollar match; provided that there is no minimum
 
10 grant eligibility threshold.
 
11      (d)  Grants under this section shall be made beginning no
 
12 later than September 1, 2000.
 
13      (e)  Grants made under this section shall not be subject 
 
14 to chapter 91.
 
15      (f)  The board may access and use any funds set aside, but
 
16 not approved for grants, for the purpose of paying any claims
 
17 caused by a hurricane.
 
18      (g)  This section shall not be construed as prohibiting the
 
19 board from spending moneys in the hurricane reserve trust fund
 
20 for other loss mitigation incentives; provided that the grant
 
21 program shall be extended to former fund policyholders when the
 
22 number of fund policyholders falls below eighty per cent of the
 
23 number of residential fund policyholders as of January 1, 2000."
 

 
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Page 4                                                     2314
                                     H.B. NO.           H.D. 1
                                                        S.D. 2
                                                        

 
 1      SECTION 3.  Statutory material to be repealed is bracketed.
 
 2 New statutory material is underscored.
 
 3      SECTION 4.  This Act shall take effect on January 1, 2011;
 
 4 provided that on January 1, 2010, section 2 of this Act shall be
 
 5 repealed and section 431P-12, Hawaii Revised Statutes, is enacted
 
 6 in the form in which it read on the day before the approval of
 
 7 this Act; and provided further that section 1 of this Act shall
 
 8 take effect retroactively to September 1, 1998.
 

 
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