Last updated: July 02. 2014 7:39AM - 164 Views
Margaret Brackett Contributing Columnist

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This week the spokesman for Newberry NOTES is Russ Dubisky, executive director of the S.C. Insurance News Service in Columbia. He has selected news and views in a variety of up-to-date topics to enlighten our readers of current events, weather, legislation and vacations. An appropriate beginning for this publication is to identify the SC Insurance News Service.

The South Carolina Insurance News Service is a trade association that represents many of the leading property/casualty insurance companies that do business in this state. We are an information and education based organization that works on behalf of our member companies in an effort to help develop a more educated consumer public.

Hurricane season began on June 1, as always. What should our readers be thinking about now that the storm season is upon us?

There are several things that listeners should be aware of relative to hurricane season. While most forecasters are predicting a normal-to-below-normal season in the Atlantic, residents should still take the time to prepare. It only takes one hurricane hitting our state to cause catastrophic damage and heartache. “ Even for folks that live in non-coastal areas, it is still a good practice to have an annual insurance review. Contact your agent or your company to make sure you have the right coverages in place.

One of those coverages everybody should consider is flood insurance. Even though we aren’t near the coast here, floods can happen essentially everywhere. Floods are the most common natural disaster in the US and 25% of all flood losses occur in areas that are deemed low to moderate risk. As development continues, and more hard surfaces and structures are built, water has fewer places to go. So just because a place has never flooded before doesn’t mean it never will. Hurricanes or tropical storms can also bring about some other severe weather as they move inland and begin to dissipate. Severe thunderstorms often lead to tornadoes or hail which can be damaging to your home and vehicles. Now might be a good time to check around your yard for any dead trees or weak and heavy branches that hang over your home. They can become damaging during a storm. Other lawn items and furniture might want to be stored securely if you know a storm is coming, so they don’t become projectiles in high-speed winds.

The state Legislature recently adjourned. Are there legislative proposals that the insurance industry is paying particular attention to?

There are several bills that we followed during the session. One of the bills that has gotten the most attention is a safety provision that prohibits texting while driving. South Carolina is among the last states to enact such a prohibition, but as a state law, there will no longer be any differences among the local government ordinances. The law has already gone into

effect, and law enforcement will start issuing warnings as part of an awareness campaign, before they start issuing fines. Another new law that may have some impact on consumers is one that allows for electronic proof of insurance. Many drivers receive an insurance card in the mail that serves as proof of liability insurance every 6 months. This new law allows insurance companies, at their customers’ request, to issue an electronic insurance card either through email, or an app. Then, if you are stopped by law enforcement, you can provide proof of insurance electronically, instead of trying to find your hard copy cards in the glove box. The Competitive Insurance Act was also passed by the General Assembly this year.

While this bill was changed quite a bit through the process, its final version passed with the following requirements: the Department of Insurance /Director shall provide market assistance and promote consumer education in the state; the Director shall submit a report on the property/casualty market to leadership in the S.C. General Assembly; all personal lines property insurers must include additional disclosures relative to general credits, discounts, and deductions at the time a new policy is issued, and upon each renewal; and the Department of Insurance shall conduct a feasibility study on the development of a state-specific catastrophe model. One major provision that was in the initial version that did not meet final approval was a request to increase the portion of the gross premium tax that is earmarked for the Safe Home program. The Safe Home program is a grant program that provides money to individuals that retrofit their homes to make them more disaster resistant. The proposal would have provided an additional $1.5 million per year to fund the grant program. Safe Home is a great program that helps make structures more disaster-resistant, which helps make our communities more resilient.

On the local level, there are a few jurisdictions that have considered accident response fees. However, there are many things, or consequences that individuals and local representatives should consider before imposing such a measure. Many proponents of this type of fee believe that this only affects insurance companies and not the constituents that they represent, at least that is the intention. However, because insurance policies are contracts between an individual and a company, local governments or third-party billing vendors lack the legal standing to require such a fee directly from an insurance company, and, in many cases, a fire truck arriving at the scene of an accident doesn’t fall into the typical definition of bodily injury or property damage so many insurers do not cover this expense as part of the claim.

If it is not covered, is the resident stuck holding the bill, even though local property taxes, and a portion of the gross premium tax that is paid by insurance companies, typically help fund local emergency response? Our member companies have and will continue to cover all losses that are already covered by your policy, which in most every case does include ambulatory service. However, because actual losses, or payments, are a factor in determining rates, if insurers are required to cover all of these fees, it is possible that this could impact future auto insurance rates. The last thing we want is to unintentionally create an environment where an individual is reluctant to call 911 because he or she doesn’t want to pay a user fee for the response.

Margaret Brackett’s column will be continued in another edition of The Newberry Observer.

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