Senate Bill 2946

AN ACT TO AMEND SECTION 83-34-1, MISSISSIPPI CODE OF 1972, TO DELETE THE UPPER TIER COUNTIES FROM THE DEFINITION OF THE TERM "COAST AREA" AS USED IN THE MISSISSIPPI WINDSTORM UNDERWRITING ASSOCIATION LAW; TO AMEND SECTION 83-34-7, MISSISSIPPI CODE OF 1972, TO REVISE THE MEMBERSHIP OF THE BOARD OF DIRECTORS; AND FOR RELATED PURPOSES.

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

SECTION 1. Section 83-34-1, Mississippi Code of 1972, is amended as follows:

83-34-1. In this chapter, unless the context otherwise requires:

(a) "Essential property insurance" means insurance against direct loss to property as defined and limited in the Windstorm and Hail Insurance form approved by the commissioner.

(b) "Association" means the Mississippi Windstorm Underwriting Association established pursuant to the provisions of this chapter.

(c) "Plan of operation" means the plan of operation of the association approved or promulgated by the Mississippi Insurance Commissioner pursuant to the provisions of this chapter.

(d) "Insurable property" means builder's risk and real property at fixed locations in coast areas or the contents located therein (but shall not include insurance on motor vehicles), which property is determined by the association, after inspection and pursuant to the criteria specified in the plan of operation, to be in an insurable condition; provided, however, any one- or two-family dwelling built in substantial accordance with the standard building code, including the design-wind requirements, which is not otherwise rendered uninsurable by reason of use, occupancy or state of repair, shall be an insurable risk within the meaning of this chapter; but neighborhood, area, location and environmental hazards beyond the control of the applicant or owner of the property shall not be considered in determining insurable condition. Provided, further, that any structure commenced on or after June 1, 1987, not built in substantial compliance with the standard building code, including the design-wind requirements therein, shall not be an insurable risk under the terms of this chapter.

(e) "Commissioner" means the Insurance Commissioner of the State of Mississippi.

(f) "Coast area" means Hancock, Harrison and Jackson * * * Counties.

(g) "Net direct premiums" means gross direct premiums, excluding reinsurance assumed and ceded, written on property in this state for the windstorm and hail causes of loss or equivalent causes of loss components of property insurance policies, including the windstorm and hail causes of loss or equivalent causes of loss components of approved residential package policies and commercial multiple peril policies, less return premiums upon cancelled contracts, dividends paid or credited to policyholders or the unused or unabsorbed portion of premium deposits and excluding premiums on farm property.

SECTION 2. Section 83-34-7, Mississippi Code of 1972, is amended as follows:

83-34-7. (1) The Board of Directors of the Mississippi Insurance Underwriting Association as presently constituted shall serve as the temporary board of directors of the association. Such temporary board of directors shall prepare and submit a plan of operation in accordance with Section 83-34-13 and shall serve until the permanent board of directors shall take office in accordance with the plan of operation. The permanent board shall consist of five (5) representatives of the members to be appointed by the temporary board of directors subject to the approval of the commissioner and three (3) agents from the coast area to be appointed by the commissioner.

(2) From and after the effective date of this act, the board of directors shall consist of the following:

(a) Six (6) representatives of the association members, who shall be from the executive-level ranks of the member companies, to be appointed by the commissioner;

(b) Three (3) agents from the coast area with at least ten (10) years' experience in the property and casualty industry, to be appointed by the Governor; and

(c) Two (2) business leaders from the coast area, one (1) to be appointed by the Lieutenant Governor and one (1) to be appointed by the Speaker of the House of Representatives.

(3) The board shall be staffed by as many employees as it deems necessary; however, the association shall be managed and operated by an executive director, comptroller and claims manager, who shall be employees of the State Rating Bureau.

SECTION 3. This act shall take effect and be in force from and after its passage.