New Jersey Assembly Bill A3910

New Jersey 2024-2025 Regular Session

• Introduced: 2/27/24
• Refer: 2/27/24
• Failed: 3/4/24

Caption

Requires home insurance companies to cover water damage caused by ground seepage, water or sewer pipe damage, or flooding.

Impact

The enactment of Bill A3910 is expected to alter the landscape of homeowners insurance policies in New Jersey. Homeowners will benefit from enhanced protection against water-related damages that are often excluded from standard policies. However, the bill also allows insurers to offer coverage under different terms if homeowners do not mitigate potential risks through necessary repairs or preventative actions. This could present challenges for some homeowners who may struggle to afford these measures.

Summary

Bill A3910, recently introduced in New Jersey, mandates that home insurance companies cover specific types of water damage. This includes water damage caused by groundwater seepage, water or sewer pipe damage, and flooding. The bill applies to homeowners insurance policies for one-to-four-family dwellings, aiming to provide clearer coverage for homeowners who may face these risks. By including groundwater seepage as a covered event, the bill addresses a significant area of concern for homeowners in flood-prone regions.

Contention

There may be points of contention regarding the financial implications of requiring this coverage. Insurance companies may argue that such mandates could lead to higher premiums for policyholders as they adjust to the increased risk associated with water damage claims. Conversely, proponents of the bill argue that this coverage is essential for protecting homeowners and reflects the realities of climate change and increasing rainfall events. The discussion may also involve debates over how to balance the interests of insurers with the needs for consumer protection in the face of environmental challenges.