HLS 21RS-627 ENGROSSED
2021 Regular Session
HOUSE BILL NO. 451
BY REPRESENTATIVE DAVIS
Prefiled pursuant to Article III, Section 2(A)(4)(b)(i) of the Constitution of Louisiana.
INSURANCE/RATES: Provides for discounts and insurance rate reductions for residential
and commercial buildings built to, or retrofitted to, reduce the threat of loss due to
windstorm events
1 AN ACT
2To amend and reenact R.S. 22:1483(A) and (C) and to enact R.S. 22:1483(D), relative to
3 insurance discounts and rate reductions for residential and commercial buildings; to
4 provide the requirements for buildings to qualify for the discount or rate reduction;
5 and to provide for related matters.
6Be it enacted by the Legislature of Louisiana:
7 Section 1. R.S. 22:1483(A) and (C) are hereby amended and reenacted and R.S.
822:1483(D) is hereby enacted to read as follows:
9 ยง1483. Premium discounts, credits, rate differentials, adjustments in deductibles,
10 and other adjustments for compliance with building codes and for damage
11 mitigation
12 A. Any insurer required to submit rates and rating plans to the commissioner
13 of insurance shall provide an actuarially justified discount, credit, rate differential,
14 adjustment in deductible, or any other adjustment to reduce the insurance premium
15 to insureds who build or retrofit a structure to comply with the requirements of the
16 State Uniform Construction Code or the Institute for Business and Home Safety.
17 * * *
18 C.(1) After July 1, 2022, all insurers required to submit rating plans to the
19 commissioner may, if actuarially justified, provide credits and discounts in
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HB NO. 451
1 compliance with the fortified home and fortified commercial standards created by
2 the Institute for Business and Home Safety. Any homeowner who is currently
3 receiving discounts pursuant to this Section may opt to maintain discounts offered
4 prior to July 1, 2022, if the homeowner continues to meet the requirements to
5 maintain such discounts, in lieu of the discount provided in this Subsection.
6 (2) To obtain a credit or discount provided in this Subsection, an insurable
7 property located in this state shall be certified as constructed in accordance with the
8 fortified home or fortified commercial standards provided by the Institute for
9 Business and Home Safety.
10 (3) An insurable property shall be certified as in conformance with the
11 fortified home or fortified commercial standards only after inspection and
12 certification by an Institute for Business and Home Safety certified inspector.
13 (4) An owner of insurable property claiming a credit or discount shall
14 maintain and provide certification records and construction records, including
15 certification of compliance with the Institute for Business and Home Safety
16 standards, for which the owner seeks a discount. Such documents may include but
17 are not limited to receipts for contractors, receipts for materials, and records from
18 local building officials.
19 (5) An owner of insurable property claiming a credit or discount shall
20 maintain the Institute for Business and Home Safety certification documents, which
21 shall be considered evidence of compliance with the fortified home or fortified
22 commercial standards. The certification shall be presented to the insurer or potential
23 insurer of a property owner before the adjustment becomes effective for the insurable
24 property along with any other necessary records.
25 (6) The credit or discount shall apply only to policies that provide wind
26 coverage and may apply to the portion of the premium for wind coverage or to the
27 total premium, if the insurer does not separate out the premium for wind coverage
28 in the rate filing. The adjustment shall apply exclusively to the premium designated
29 for the improved insurable property. The adjustment is not required to be in addition
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HB NO. 451
1 to other mitigation adjustments provided by the insurer and shall be in lieu of those
2 other adjustments, including those in place prior to January 1, 2022, if they are
3 deemed to be duplicated.
4 (7) The records required by this Subsection shall be subject to audit by the
5 commissioner.
6 (8) Nothing in this Section shall prohibit insurers from offering additional
7 adjustments in deductible, other credit rate differentials, or a combination thereof.
8 These adjustments shall be available under the terms specified in this Section to any
9 owner who builds or locates a new insurable property in this state to resist loss due
10 to hurricane, tornado, or other catastrophic windstorm events.
11 (9) For the purposes of this Subsection, insurable property includes single-
12 family residential property, commercial property, modular homes, and manufactured
13 homes that may be retrofitted.
14 D. The commissioner of insurance, in consultation with the State Uniform
15 Construction Code Council, shall, no later than January 1, 2008, promulgate rules
16 and regulations in accordance with the Administrative Procedure Act to implement
17 the provisions of this Section. The rules and regulations may include but not be
18 limited to the following:
19 (1) Provisions defining and delineating the criteria for discounts, credits, rate
20 differentials, adjustments in deductibles, or any other adjustments to reduce the
21 insurance premium and how such discounts, credits, rate differentials, adjustments
22 in deductibles, or any other adjustments are computed in determining their
23 application in each premium quoted.
24 (2) Those items necessary for an insurer to compute or otherwise determine
25 the actuarially justified amount of any premium rate reduction, discount, credit, rate
26 differential, reduction in deductible, or other adjustment available to an insured.
27 (3) Provisions establishing the inspection and certification requirements for
28 insureds who comply with the provisions of this Section.
29 (4) Recordkeeping requirements for insurers.
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HB NO. 451
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
HB 451 Engrossed 2021 Regular Session Davis
Abstract: Provides for discounts and insurance rate reductions for residential and
commercial buildings built to, or retrofitted to, reduce the threat of loss due to
windstorm events.
Present law provides that any insurer required to submit rates and rating plans to the
commissioner of insurance shall provide an actuarially justified discount, credit, rate
differential, adjustment in deductible, or any other adjustment to reduce the insurance
premium to insureds who build or retrofit a structure to comply with the requirements of the
State Uniform Construction Code.
Proposed law retains present law and provides that insurers required to submit rates and
rating plans to the commissioner shall comply with the requirements of the State Uniform
Construction Code or the Institute for Business and Home Safety.
Proposed law provides that after July 1, 2022, all insurers required to submit rating plans to
the commissioner may, if actuarially justified, provide credits and discounts in compliance
with the fortified home and fortified commercial standards created by the Institute for
Business and Home Safety.
Proposed law provides that any homeowner currently receiving discounts under present law
may opt to maintain discounts offered prior to July 1, 2022, so long as the homeowner
continues to meet the requirements to maintain such discounts, in lieu of the discount
provided in present law.
Proposed law provides that to obtain a credit or discount provided in proposed law, any
insurable property located in this state may be certified as constructed in accordance with
the fortified home or fortified commercial standards provided by the Institute for Business
and Home Safety.
Proposed law provides that an insurable property shall be certified as in conformance with
the fortified home or fortified commercial standards only after inspection and certification
by an Institute for Business and Home Safety certified inspector.
Proposed law provides that an owner of insurable property claiming a credit or discount shall
maintain and provide certification records and construction records for which it seeks a
discount.
Proposed law provides that an owner of insurable property claiming a credit or discount shall
maintain the Institute for Business and Home Safety certification documents. The
certification shall be presented to the insurer or potential insurer of a property owner before
the adjustment becomes effective for the insurable property along with any other necessary
records.
Proposed law provides that the credit or discount shall apply only to policies that provide
wind coverage and may apply to the portion of the premium for wind coverage or to the total
premium, if the insurer does not separate out the premium for wind coverage in the rate
filing.
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HB NO. 451
Proposed law provides that the records required in proposed law are subject to audit by the
commissioner.
Proposed law provides that nothing in proposed law shall prohibit insurers from offering
additional adjustments in deductible, other credit rate differentials, or a combination thereof.
Proposed law specifies that for the purposes of proposed law, insurable property shall
include single-family residential property, commercial property, modular homes, and
manufactured homes that may be retrofitted.
Proposed law makes technical changes.
(Amends R.S. 22:1483(A) and (C); Adds R.S. 22:1483(D))
Summary of Amendments Adopted by House
The Committee Amendments Proposed by House Committee on Insurance to the
original bill:
1. Make technical changes.
2. Allow insurers required to submit rates and rating plans to the commissioner to
either comply with the requirements of the State Uniform Construction Code or
the Institute for Business and Home Safety.
3. Make the application of the credits and discounts by insurers in present law (R.S.
22:1483) permissive, rather than mandatory.
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