The

New
York
Department
of
Financial
Services
(NYDFS)
announced
on
Thursday
the
publication
of
a
policy
recommendation
that
encourages
property

insurers
to
offer
free
loss-mitigation
options
for
policyholders
that
would
ultimately
reduce
premium
costs.

NYDFS
Superintendent
Adrienne
Harris
cited
the
acceleration
of

climate-related
disasters
and
property
damage
that
has
stressed
the
property
insurance
industry
and
marketplace,
pushing
some
insurers
out
of
areas
they
deem
to
carry
too
much
risk
and
making
premiums
unwieldy
for
consumers.

“The
increasing
severity
and
frequency
of
climate-related
events
is
increasing
losses
and
raising
insurance
rates
across
the
country,”
Harris
said.
“In
light
of
these
challenges,
DFS
is
focused
every
day
on
ensuring
New
York
homeowners
have
access
to
affordable
insurance.

“Adoption
of
loss
mitigation
tools
and
services
supports
both
individuals
and
insurers
by
lowering
homeowner
costs,
protecting
homes,
and
reducing
insurer
risk,
helping
to
create
a
more
stable
and
resilient
insurance
market,”
she
added.

The

guidance
states
that
“when
including
these
tools
and
services
in
a
policy,
the
policy
should
specify
what
is
being
offered,
who
is
paying
for
the
tools
and
services,
and
how
much
a
policyholder
must
pay,”
according
to
an
announcement
from
NYDFS.
“An
insurer
should
offer
the
tools
and
services
in
a
fair
and
nondiscriminatory
manner
to
like
insureds.”

Overly
broad
or
vague
language
that
could
open
the
door
to
potential
discrimination
among
policy
holders
with
similar
risk
profiles
will
not
be
accepted
by
NYDFS,
the
department
said,
and
insurers
are
“encouraged
to
file
[…]
actuarially
appropriate
discounts
for
the
installation
of
devices
or
systems
that
mitigate
or
prevent
losses.”

The
circular
from
NYDFS
comes
as
the
property
insurance
industry
is
reckoning
with
a
“perfect
storm”
of
rising
costs
for
providers,
paired
with
higher
premiums
and
more
limited
coverage
for
consumers,
according
to
a
recent
survey
from


Deloitte.

Gathering
input
from
a
sample
of
2,000
homeowners
across
21
states
in
January,
the
survey
targeted
“respondents
who
said
their
coverage
is
inadequate”
in
states
at
“high
risk
of
climate-related
disasters.”

Researchers
found
that
rising
home
repair
costs
and
more
frequent
claims
are
driving
up
the
costs
for
insurers
to
provide
coverage,
which
has
led
some
insurers
to

pull
back
entirely
from
areas
they
classify
as
“high
risk.”
This
makes
it
more
challenging
for
residents
in
these
areas
to
find
coverage,
particularly
adequate
coverage
at
what
they
would
consider
a
reasonable
price.

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