MISSISSIPPI LEGISLATURE
2025 Regular Session
To: Insurance; Accountability, Efficiency, Transparency
By: Representative Bennett
AN ACT TO PROVIDE FOR A HURRICANE DEDUCTIBLE; TO PROVIDE DEFINITIONS; TO PROVIDE THAT FOR ALL HOMEOWNERS' INSURANCE POLICIES OR OTHER POLICIES INSURING A ONE- OR TWO-FAMILY OWNER OCCUPIED PREMISES FOR FIRE AND ALLIED LINES, ISSUED OR RENEWED BY AUTHORIZED INSURERS ON OR AFTER JANUARY 1, 2026, ANY SEPARATE DEDUCTIBLE THAT APPLIES IN PLACE OF ANY OTHER DEDUCTIBLE TO LOSS OR DAMAGE RESULTING FROM A NAMED STORM OR HURRICANE SHALL BE APPLIED ON AN ANNUAL BASIS TO ALL NAMED-STORM OR HURRICANE LOSSES THAT ARE SUBJECT TO THE SEPARATE DEDUCTIBLE DURING THE CALENDAR YEAR; TO BRING FORWARD SECTIONS 83-2-3, 83-5-1, 83-1-191, 27-7-1001, 27-7-1003, 27-7-1005, 27-7-1007, 83-34-16, 83-75-1, 83-75-3, 83-75-5, 83-75-7 AND 83-34-1, MISSISSIPPI CODE OF 1972, FOR THE PURPOSE OF POSSIBLE AMENDMENT; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. (1) For purposes of this section, the following definitions shall apply:
(a) "Hurricane" means a storm system that has been declared a hurricane by the National Hurricane Center of the National Weather Service.
(b) "Named storm" means a storm system that has been declared a named storm by the National Hurricane Center of the National Weather Service.
(c) "Separate deductible" means a deductible that applies to damage incurred during a specified weather event and may be expressed as a percentage of the insured value of the property or as a specific dollar amount and includes hurricane, named-storm, and wind and hail deductibles.
(2) For all homeowners' insurance policies or other policies insuring a one- or two-family owner occupied premises for fire and allied lines, issued or renewed by authorized insurers on or after January 1, 2026, any separate deductible that applies in place of any other deductible to loss or damage resulting from a named storm or hurricane shall be applied on an annual basis to all named-storm or hurricane losses that are subject to the separate deductible during the calendar year.
(3) If an insured incurs named-storm or hurricane losses from more than one named storm or hurricane during a calendar year that are subject to the separate deductible referred to in subsection (2) of this section, the insurer may apply a deductible to the succeeding named storms or hurricanes that is equal to the remaining amount of the separate deductible, or the amount of the deductible that applies to all perils other than a named storm or hurricane, whichever is greater. Insurers may require policyholders to maintain receipts or other records of such losses in order to apply such losses to subsequent named-storm or hurricane claims.
(4) (a) The commissioner shall prescribe a separate form regarding named storm, hurricane, and wind and hail deductibles proposed in a policy of homeowners' insurance. The form shall list the specific amount for each deductible expressed as a percentage of the insured value of the property, or as a specific dollar amount, or as both. For new policies with an effective date after January 1, 2026, an insurer shall provide the form and request that it be signed by the named insured or his legal representative. The completion of a new form shall not be required if a renewal, reinstatement, substitute, or amended policy is issued to the same named insured by the same insurer or any of its affiliates.
(b) An insurer shall provide a new form and request that it be signed by the named insured or his legal representative, if the insurer changes the percentage or specific dollar amount of any named storm, hurricane, or wind and hail deductible listed in the policy. If the policy uses a percentage deductible, a new form shall not be required if the dollar amount of the deductible changes because of an increase in policy limits; however, a new form shall be required if the percentage changes.
(c) A new form provided to an insured shall be for the insured's informational purposes only, and it shall not affect the terms and conditions of the policy.
(d) If a policy is purchased using electronic means or the insured elects to receive policy documents electronically, the insurer shall transmit the form provided for in this Subsection to the insured electronically and provide a method whereby the insured may sign the form electronically.
(e) Nothing in this subsection shall be interpreted to create a cause of action not otherwise provided by law.
SECTION 2. Section 83-2-3, Mississippi Code of 1972, is brought forward as follows:
83-2-3. (1) Rates shall comply with the following standards:
(a) Rates shall not be excessive, inadequate or unfairly discriminatory.
(b) A rate is excessive if it is likely to produce a profit that is unreasonably high for the insurance provided or if the expense provision included therein is unreasonably high in relation to the services rendered.
(c) A rate is inadequate if it threatens the solvency of the insurance company or tends to create a monopoly.
(d) Unfair discrimination exists if, after allowing for practical limitations, price differentials fail to reflect equitably the differences in expected losses and expenses. A rate is not unfairly discriminatory because different premiums result for policyholders with like loss exposures with different expenses, or like expenses but different loss exposures, so long as the rate reflects the differences with reasonable accuracy.
(2) In determining whether rates comply with the standards set forth in subsection (1), the following criteria shall apply:
(a) Due consideration shall be given to past and prospective loss and expense experience within and outside this state; to catastrophe hazards; to any residual market loss redistributions and other similar obligations; to a reasonable provision for profit and contingencies; to trends within and outside this state; to loadings for leveling premium rates over a reasonable period of time or for dividends or savings to be allowed or returned by insurers to their policyholders, members or subscribers; and to all other relevant factors, including the judgment of the filer.
(b) Risks may be classified in any reasonable way for the establishment of rates except that no risks may be grouped by classifications based, in whole or in part, on race, color, creed, or national origin of the risk. Rates may be modified for individual risks in accordance with rating plans or schedules which provide for recognition of probable variations in hazards, expenses or both.
(c) The systems of expense provisions included in rates for use by an insurer or group of insurers may differ from those of other insurers or group of insurers to reflect the operating methods of such insurer or group with respect to any kind of insurance, or with respect to any subdivision or combination thereof.
(d) Any homeowners' insurance policy filed with the Commissioner of Insurance that offers a percentage deductible for the peril of windstorm from a named storm shall offer a buy-back provision for that deductible which is actuarially sound; however, the Commissioner of Insurance may grant a waiver from the mandatory buy-back provision in accordance with the following procedure and criteria:
(i) An insurance company shall make a formal filing requesting a waiver from the buy-back provision requirement with the Commissioner of Insurance.
(ii) An insurance company shall submit written proof in its formal filing as to why it is in the best interest of Mississippi policyholders to receive a waiver from the buy-back provision requirement and shall provide any supporting documentation requested by the commissioner deemed appropriate to make his decision.
(iii) All expenses incurred by the Commissioner of Insurance or his designee in determining the validity of the waiver request shall be borne by the petitioning insurer. Such expenses may include, but not be limited to, the cost of reviewing the filing by actuaries, and if the commissioner deems a public hearing appropriate, the cost of a facility, the cost of publicity and the cost of a court reporter for the hearing.
(e) The commissioner shall establish by regulation uniform policy language regarding the applicability of hurricane deductibles and the form of notice to be provided to an insured under a homeowner's insurance policy by an insurer utilizing a hurricane deductible program or programs. The term "hurricane," for the purpose of a hurricane deductible program, means a storm system that has been declared to be a hurricane by the National Hurricane Center of the National Weather Service. The duration of the hurricane includes the time period, in Mississippi:
(i) Beginning at the time a hurricane watch or hurricane warning is issued for any part of Mississippi by the National Hurricane Center of the National Weather Service;
(ii) Continuing for the time period during which the hurricane conditions exist anywhere in Mississippi; and
(iii) Ending twenty-four (24) hours following the termination of the last hurricane watch or hurricane warning issued for any part of Mississippi by the National Hurricane Center of the National Weather Service.
(3) To ensure the most appropriate use of state resources with respect to the engagement of actuarial services for the review of rate filings under this chapter, the commissioner may adopt rules and regulations to establish the criteria and procedures for determining when a rate filing should be submitted to an actuary for review.
SECTION 3. Section 83-5-1, Mississippi Code of 1972, is brought forward as follows:
83-5-1. All indemnity or guaranty companies, all companies, including those companies defined in Section 83-41-303(n), corporations, partnerships, associations, individuals and fraternal orders, whether domestic or foreign, transacting, or to be admitted to transact, the business of insurance in this state are insurance companies within the meaning of this chapter, and shall be subject to the inspection and supervision of the commissioner.
SECTION 4. Section 83-1-191, Mississippi Code of 1972, is brought forward as follows:
83-1-191. (1) There is established within the Department of Insurance a Comprehensive Hurricane Damage Mitigation Program. This section does not create an entitlement for property owners or obligate the state in any way to fund the inspection or retrofitting of residential property or commercial property in this state. Implementation of this program is subject to the availability of funds that may be appropriated by the Legislature for this purpose. The program may develop and implement a comprehensive and coordinated approach for hurricane damage mitigation that may include the following:
(a) Cost-benefit study on wind hazard mitigation construction measures. The performance of a cost-benefit study to establish the most appropriate wind hazard mitigation construction measures for both new construction and the retrofitting of existing construction for both residential and commercial facilities within the wind-borne debris regions of Mississippi as defined by the International Building Code. The recommended wind construction techniques shall be based on both the newly adopted Mississippi building code sections for wind load design and the wind-borne debris region. The list of construction measures to be considered for evaluation in the cost-benefit study shall be based on scientifically established and sound, but common, construction techniques that go above and beyond the basic recommendations in the adopted building codes. This allows residents to utilize multiple options that will further reduce risk and loss and still be awarded for their endeavors with appropriate wind insurance discounts. It is recommended that existing accepted scientific studies that validate the wind hazard construction techniques benefits and effects be taken into consideration when establishing the list of construction techniques that homeowners and business owners can employ. This will ensure that only established construction measures that have been studied and modeled as successful mitigation measures will be considered to reduce the chance of including risky or unsound data that will cost both the property owner and state unnecessary losses. The cost-benefit study shall be based on actual construction cost data collected for several types of residential construction and commercial construction materials, building techniques and designs that are common to the region. The study shall provide as much information as possible that will enhance the data and options provided to the public, so that homeowners and business owners can make informed and educated decisions as to their level of involvement. Based on the construction data, modeling shall be performed on a variety of residential and commercial designs, so that a broad enough representative spectrum of data can be obtained. The data from the study will be utilized in a report to establish tables reflecting actuarially appropriate levels of wind insurance discounts (in percentages) for each mitigation construction technique/combination of techniques. This report will be utilized as a guide for the Department of Insurance and the insurance industry for developing actuarially appropriate discounts, credits or other rate differentials, or appropriate reductions in deductibles, for properties on which fixtures or construction techniques demonstrated to reduce the amount of loss in a windstorm have been installed or implemented. Additional data that will enhance the program, such as studies to reflect property value increases for retrofitting or building to the established wind hazard mitigation construction techniques and cost comparison data collected to establish the value of this program against the investment required to include the mitigation measures, also may be provided.
(b) Wind certification and hurricane mitigation inspections.
(i) Home-retrofit inspections of site-built, residential property, including single-family, two-family, three-family or four-family residential units, and a set of representative commercial facilities may be offered to determine what mitigation measures are needed and what improvements to existing residential properties are needed to reduce the property's vulnerability to hurricane damage. A state program may be established within the Department of Insurance to provide homeowners and business owners wind certification and hurricane mitigation inspections. The inspections provided to homeowners and business owners, at a minimum, must include:
1. A home inspection and report that summarizes the results and identifies corrective actions a homeowner may take to mitigate hurricane damage.
2. A range of cost estimates regarding the mitigation features.
3. Insurer-specific information regarding premium discounts correlated to recommended mitigation features identified by the inspection.
4. A hurricane resistance rating scale specifying the home's current as well as projected wind resistance capabilities.
This data may be provided by trained and certified inspectors in standardized reporting formats and forms to ensure all data collected during inspections is equivalent in style and content that allows construction data, estimates and discount information to be easily assimilated into a database. Data pertaining to the number of inspections and inspection reports may be stored in a state database for evaluation of the program's success and review of state goals in reducing wind hazard loss in the state.
(ii) To qualify for selection by the department as a provider of wind certification and hurricane mitigation inspections services, the entity shall, at a minimum, and on a form and in the manner prescribed by the commissioner:
1. Use wind certification and hurricane mitigation inspectors who:
a. Have prior experience in residential and/or commercial construction or inspection and have received specialized training in hurricane mitigation procedures through the state certified program. In order to qualify for training in the inspection process, the individual should be either a licensed building code official, a licensed contractor or inspector in the State of Mississippi, or a civil engineer.
b. Have undergone drug testing and background checks.
c. Have been certified through a state mandated training program, in a manner satisfactory to the department, to conduct the inspections.
d. Have not been convicted of a felony crime of violence or of a sexual offense; have not received a first-time offender pardon or nonadjudication order for a felony crime of violence or of a sexual offense; or have not entered a plea of guilty or nolo contendere to a felony charge of violence or of a sexual offense.
e. Submit a statement authorizing the Commissioner of Insurance to order fingerprint analysis or any other analysis or documents deemed necessary by the commissioner for the purpose of verifying the criminal history of the individual. The commissioner shall have the authority to conduct criminal history verification on a local, state or national level, and shall have the authority to require the individual to pay for the costs of such criminal history verification.
2. Provide a quality assurance program including a reinspection component.
3. Have data collection equipment and computer systems, so that data can be submitted electronically to the state's database of inspection reports, insurance certificates, and other industry information related to this program. It is mandatory that all inspectors provide original copies to the property owner of any inspection reports, estimates, etc., pertaining to the inspection and keep a copy of all inspection materials on hand for state audits.
(c) Financial grants to retrofit properties. Financial grants may be used to encourage single-family, site-built, owner-occupied, residential property owners or commercial property owners to retrofit their properties to make them less vulnerable to hurricane damage. No financial grant made under this section shall exceed Ten Thousand Dollars ($10,000.00) per recipient.
(d) Education and consumer awareness. Multimedia public education, awareness and advertising efforts designed to specifically address mitigation techniques may be employed, as well as a component to support ongoing consumer resources and referral services. In addition, all insurance companies shall provide notification to their clients regarding the availability of this program, participation details, and directions to the state website promoting the program, along with appropriate contact phone numbers to the state agency administrating the program. The notification to the clients must be sent by the insurance company within thirty (30) days after filing their insurance discount schedules with the Department of Insurance.
(e) Advisory council. There is created an advisory council to provide advice and assistance to the program administrator with regard to his or her administration of the program. The advisory council shall consist of:
(i) An agent, selected by the Independent Insurance Agents of Mississippi.
(ii) Two (2) representatives of residential property insurers, selected by the Department of Insurance.
(iii) One (1) representative of homebuilders, selected by the Home Builders Association of Mississippi.
(iv) The Chairman of the House Insurance Committee, or his designee.
(v) The Chairman of the Senate Insurance Committee, or his designee.
(vi) The Executive Director of the Mississippi Windstorm Underwriting Association, or his designee.
(vii) The Director of the Mississippi Emergency Management Agency, or his designee.
Members appointed under subparagraphs (i) and (ii) shall serve at the pleasure of the Department of Insurance. All other members shall serve as voting ex officio members. Members of the advisory council who are not legislators, state officials or state employees shall be compensated at the per diem rate authorized by Section 25-3-69, and shall be reimbursed in accordance with Section 25-3-41, for mileage and actual expenses incurred in the performance of their duties. Legislative members of the advisory council shall be paid from the contingent expense funds of their respective houses in the same manner as provided for committee meetings when the Legislature is not in session; however, no per diem or expense for attending meetings of the advisory council may be paid while the Legislature is in session. No advisory council member may incur per diem, travel or other expenses unless previously authorized by vote, at a meeting of the council, which action shall be recorded in the official minutes of the meeting. Nonlegislative members shall be paid from any funds made available to the advisory council for that purpose.
(f) Rules and regulations. The Department of Insurance may adopt rules and regulations governing the Comprehensive Hurricane Damage Mitigation Program. The department also may adopt rules and regulations establishing priorities for grants provided under this section based on objective criteria that gives priority to reducing the state's probable maximum loss from hurricanes. However, pursuant to this overall goal, the department may further establish priorities based on the insured value of the dwelling, whether or not the dwelling is insured by the Mississippi Windstorm Underwriting Association and whether or not the area under consideration has sufficient resources and the ability to perform the retrofitting required.
(2) Nothing in this section shall prohibit the Department of Insurance from entering into an agreement with any other appropriate state agency to assist with or perform any of the duties set forth hereunder.
(3) The Department of Insurance shall issue a request for proposals to contract with a third party for the administration of the Comprehensive Hurricane Damage Mitigation Program. The contract for the third-party administrator shall be funded from monies in the Comprehensive Hurricane Damage Mitigation Program Fund created in subsection (4) of this section, and that amount shall not exceed one percent (1%) of the funds appropriated to the Department of Insurance for the program. If the third-party administrator selected through the request for proposals is replaced or is otherwise changed, the Department of Insurance shall notify the Chairs of the House and Senate Appropriations and Insurance Committees.
(4) There is created a special fund in the State Treasury to be known as the Comprehensive Hurricane Damage Mitigation Program Fund. The fund shall consist of any monies from any source that are designated or made available for deposit into the fund. The Department of Insurance may apply for any federal or private grants to provide additional funds for the special fund. Monies in the fund shall be expended by the Department of Insurance, upon appropriation by the Legislature, for the purposes as provided in this section. Unexpended amounts remaining in the fund at the end of a fiscal year shall not lapse into the State General Fund, and any interest earned or investment earnings on amounts in the fund shall be deposited into such fund.
(5) This section shall stand repealed from and after July 1, 2025.
SECTION 5. Section 27-7-1001, Mississippi Code of 1972, is brought forward as follows:
27-7-1001. As used in this article, the following terms shall have the meanings as defined in this section:
(a) "Catastrophe savings account" means a regular savings account or money market account established by an insurance policyholder who is a state income taxpayer (i) to pay an insurance deductible under an insurance policy that covers the taxpayer's legal residence that covers hurricane, flood, windstorm or other catastrophic event damage, (ii) to pay for catastrophic event damage to the taxpayer's legal residence that is not covered by the policy of insurance that covers the taxpayer's legal residence for such damage after the deductible under such policy has been paid, or (iii) to pay self-insured losses for the taxpayer's legal residence from a hurricane, flood, windstorm, or other catastrophic event. The account must be labeled as a "catastrophe savings account" in order to qualify as a catastrophe savings account for the purposes of this article. A taxpayer may establish only one (1) catastrophe savings account and shall specify that the purpose of the account is to cover the aggregate amount of insurance policy deductibles and other uninsured portions of risks of loss from a hurricane, flood, windstorm or other catastrophic event.
(b) "Catastrophic event" means windstorms, cyclones, earthquakes, hurricanes, ice storms, tornadoes, high winds, flood, hail and force majeure, and similar perils not normally among those covered under most property casualty insurance policies, but obtainable through the purchase of wind, wind and hail, flood, or storm or windstorm coverage, or any combination of those coverages. The term "catastrophic event" also includes any event or occurrence for which a Presidential declaration of disaster or declaration of disaster by the Governor is issued.
SECTION 6. Section 27-7-1003, Mississippi Code of 1972, is brought forward as follows:
27-7-1003. (1) Except as otherwise provided in Section 27-7-1005, the amounts contributed to a catastrophe savings account in accordance with subsection (3) of this section, interest income earned on a catastrophe savings account, and distributions from a catastrophe savings account shall be excluded from the taxable gross income of the account holder under Section 27-7-15.
(2) A catastrophe savings account is not subject to attachment, levy, garnishment, or legal process in this state, provided that no funds in an account are derived from or the result of a fraudulent conveyance making contributions to the account.
(3) The total amount that may be contributed to a catastrophe savings account shall not exceed any of the following:
(a) In the case of an individual whose qualified insurance deductible is less than or equal to One Thousand Dollars ($1,000.00), the amount of Two Thousand Dollars ($2,000.00).
(b) In the case of an individual whose qualified insurance deductible is greater than One Thousand Dollars ($1,000.00), the amount equal to the lesser of Fifteen Thousand Dollars ($15,000.00) or twice the amount of the taxpayer's qualified insurance deductible.
(c) In the case of a self-insured individual who chooses not to obtain insurance on his or her legal residence, the amount of Three Hundred Fifty Thousand Dollars ($350,000.00), but in no event may the amount contributed exceed the value of the taxpayer's legal residence.
(4) If a taxpayer contributes in excess of the limits provided in subsection (3) of this section, the taxpayer shall withdraw the amount of the excess contributions and include that amount in the taxable gross income of the taxpayer in the year of withdrawal.
SECTION 7. Section 27-7-1005, Mississippi Code of 1972, is brought forward as follows:
27-7-1005. (1) A distribution from a catastrophe savings account shall be included in the taxable gross income of the taxpayer unless the amount of the distribution is used to pay qualified catastrophe expenses.
(2) No amount of a distribution shall be included in the taxable gross income of the taxpayer if the qualified catastrophe expenses of the taxpayer during the taxable year are equal to or greater than the aggregate distributions during the taxable year.
(3) If the aggregate distributions exceed the qualified catastrophe expenses during the taxable year, the amount otherwise included in the taxable gross income of the taxpayer shall be reduced by the amount of the distributions for qualified catastrophe expenses.
(4) (a) The tax paid under Section 27-7-5 that is attributable to a taxable distribution shall be increased by two and one-half percent (2-1/2%) of the amount of the distribution that is includable in the taxable gross income of the taxpayer.
(b) The additional tax imposed by this subsection does not apply if either of the following apply:
(i) The taxpayer no longer owns a legal residence that qualifies for homestead exemption under Section 27-33-1 et seq.; or
(ii) The distribution is from a catastrophe savings account conforming with Section 27-7-1003(3)(c) and is made on or after the date on which the taxpayer attains the age of seventy (70) years.
(5) If a taxpayer who owns a catastrophe savings account dies, the amount of money in his or her account shall be included in the taxable gross income of the person who receives the account, unless that person is the surviving spouse of the taxpayer. Upon the death of the surviving spouse, the amount of money in the account shall be included in the taxable gross income of the person who receives the account. The additional tax imposed in subsection (4) of this section does not apply to a distribution from the account upon the death of the taxpayer or the surviving spouse.
SECTION 8. Section 27-7-1007, Mississippi Code of 1972, is brought forward as follows:
27-7-1007. The Commissioner of Revenue may promulgate rules and regulations necessary to implement and administer this article.
SECTION 9. Section 83-34-16, Mississippi Code of 1972, is brought forward as follows:
83-34-16. The Mississippi Windstorm Underwriting Association shall provide a premium discount for any individual who builds a "fortified home" pursuant to the Institute for Business and Home Safety (IBHS). Licensed architects, engineers or inspectors certified by the Department of Insurance shall determine whether a dwelling meets the criteria for a "fortified home" pursuant to the Institute for Business and Home Safety. The Mississippi Windstorm Underwriting Association shall provide a premium discount for any individual who improves his residence with demonstrated mitigation measures that provide protection against damages caused by a windstorm or hurricane.
SECTION 10. Section 83-75-1, Mississippi Code of 1972, is brought forward as follows:
83-75-1. (1) Not later than July 1, 2013, insurance companies shall provide a premium discount or insurance rate reduction in an amount and manner as established in subsection (6) of this section and according to Section 83-75-5. In addition, insurance companies may also offer additional adjustments in deductible, other credit rate differentials, or a combination thereof, collectively referred to as adjustments. These adjustments shall be available under the terms specified in this section to any owner who builds or locates a new insurable property in Harrison, Hancock, Jackson, Stone and Pearl River Counties, to resist loss due to hurricane or other catastrophic windstorm events.
(2) Not later than July 1, 2019, insurance companies shall provide a premium discount or insurance rate reduction for new residential insurable property in an amount and manner as established in subsection (6) of this section and according to Section 83-75-5. In addition, insurance companies may also offer additional adjustments in deductible, other credit rate differentials, or a combination thereof, collectively referred to as adjustments. These adjustments shall be available under the terms specified in this section to any owner who builds or locates a new residential insurable property to resist loss due to tornado or other catastrophic windstorm events in any county located in the State of Mississippi.
(3) Not later than July 1, 2021, insurance companies shall provide a premium discount or insurance rate reduction for new commercial insurable property in an amount and manner as established in subsection (6) of this section and according to Section 83-75-5. In addition, insurance companies may also offer additional adjustments in deductible, other credit rate differentials, or a combination thereof, collectively referred to as adjustments. These adjustments shall be available under the terms specified in this section to any owner who builds or locates a new commercial insurable property to resist loss due to hurricane, tornado or other catastrophic windstorm events in any county located in the State of Mississippi.
(4) To obtain the adjustment provided in this section, an insurable property located in this state shall be certified as constructed in accordance with (a) the 2006 or newer version of the International Residential Code, as amended, including the entire coastal construction supplement as recommended by the Mississippi Windstorm Mitigation Coordination Council; or (b) the 2012 or newer version of the International Building Code, as amended; or (c) the Fortified for Safer Living or similar programs adopted by the Insurance Institute for Business and Home Safety; or (d) any other mitigation program recommended by the Mississippi Windstorm Mitigation Coordination Council and approved by the Commissioner of Insurance. An insurable property shall be certified as conforming to the applicable building codes only after an evaluation of the insurable property has been satisfactorily completed by a building official or a certified and licensed building evaluator. An insurable property shall be certified as conforming to Fortified for Safer Living criteria only after evaluation and certification by an Insurance Institute for Business and Home Safety certified evaluator.
(5) An owner of insurable property claiming an adjustment under this section shall maintain sufficient certification records and construction records including, but not limited to, a Certificate of Occupancy denoting compliance with the applicable building code in subsection (4)(a) of this section or valid certification from the Insurance Institute for Business and Home Safety for compliance with the program described in subsection (4)(b) of this section.
(6) Insurers required to submit rates and rating plans to the commissioner shall submit an actuarially justified rating plan for any person who builds an insurable property to comply with the sets of requirements of subsection (4) of this section. An insurer is not required to provide the same amount of adjustment for a building code insurable property as the insurer would to a Fortified for Safer Living insurable property. An adjustment shall only apply to policies that provide wind coverage and may apply to that portion of the premium for wind coverage or to the total premium if the insurer does not separate out its premium for wind coverage in its rate filing. The adjustment shall apply exclusively to the premium designated for the improved insurable property. In addition to the requirements of this section, an insurer may voluntarily offer any other mitigation adjustment that the insurer deems appropriate.
SECTION 11. Section 83-75-3, Mississippi Code of 1972, is brought forward as follows:
83-75-3. (1) Not later than July 1, 2013, insurance companies shall provide a premium discount or insurance rate reduction in an amount and manner as established in subsection (5) of this section and according to Section 83-75-5. In addition, insurance companies may also offer additional adjustments in deductible, other credit rate differentials, or
a combination thereof, collectively referred to as adjustments. These adjustments shall be available under the terms specified in this section to any owner who retrofits his or her insurable property in Harrison, Hancock, Jackson, Stone and Pearl River Counties to resist loss due to hurricane or other catastrophic windstorm events.
(2) Not later than July 1, 2021, insurance companies shall provide a premium discount or insurance rate reduction in an amount and manner as established in subsection (5) of this section and according to Section 83-75-5. In addition, insurance companies may also offer additional adjustments in deductible, other credit rate differentials, or a combination thereof, collectively referred to as adjustments. These adjustments shall be available under the terms specified in this section to any owner who retrofits existing commercial insurable property to resist loss due to tornado or other catastrophic windstorm events in any county located in the State of Mississippi.
(3) To obtain the adjustment provided in this section, an insurable property shall be retrofitted to one (1) of the tiered mitigation levels as defined by the Insurance Institute for Business and Home Safety, or other mitigation program, or other construction technique, or standardized code that is recommended by the Mississippi Windstorm Mitigation Coordination Council and approved by the Commissioner of Insurance. Zone three HUD code manufactured homes installed to specifications and regulations promulgated by the Commissioner of Insurance shall be considered. An insurable property shall be certified as conforming to Fortified for Safer Homes requirements only after evaluation and certification by an Insurance Institute for Business and Home Safety certified evaluator. Certification of conformity of an insurable property with the other mitigation program, other construction technique, or other standardized code shall be made only by a building official or other certified or licensed building evaluator.
(4) An owner of insurable property claiming an adjustment under this section shall maintain sufficient certification records and construction records including, but not limited to, a certification of compliance with an approved mitigation program as promulgated by the Mississippi Windstorm Mitigation Coordination Council and approved by the Commissioner of Insurance or valid certification from the Insurance Institute for Business and Home Safety for compliance with a program described in subsection (3) of this section.
(5) Insurers required to submit rates and rating plans to the commissioner shall submit actuarially justified rating plans for any person who retrofits an insurable property to comply with the sets of alternatives provided in subsection (3) of this section. The adjustment shall only apply to policies that provide wind coverage and may apply to that portion of the premium for wind coverage or to the total premium if the insurer does not separate out its premium for wind coverage in its rate filing. The adjustment shall apply exclusively to the premium designated for the improved insurable property. In addition to the requirements of this section, an insurer may voluntarily offer any other mitigation adjustment that the insurer deems appropriate.
SECTION 12. Section 83-75-5, Mississippi Code of 1972, is brought forward as follows:
[Until July 1, 2021, this section shall read as follows:]
83-75-5. For the purposes of this chapter, the term "insurable property" includes single-family residential property. "Insurable property" also includes modular homes satisfying the codes, standards, or techniques as provided in Section 83-75-1 or 83-75-3. Manufactured homes or mobile homes are excluded from "insurable property," except as expressly provided in Section 83-75-3(3).
[From and after July 1, 2021, this section shall read as follows:]
83-75-5. For the purposes of this chapter, the term "insurable property" includes single-family residential and commercial property. "Insurable property" also includes modular homes satisfying the codes, standards, or techniques as provided in Section 83-75-1 or 83-75-3. Manufactured homes or mobile homes are excluded from "insurable property," except as expressly provided in Section 83-75-3(3).
SECTION 13. Section 83-75-7, Mississippi Code of 1972, is brought forward as follows:
83-75-7. The Commissioner of Insurance shall promulgate such rules and regulations as are necessary to implement and administer this chapter.
SECTION 14. Section 83-34-1, Mississippi Code of 1972, is brought forward as follows:
83-34-1. In this chapter, unless the context otherwise requires:
(a) "Essential property insurance" means insurance against direct loss to property from the risk of windstorm and hail in the manner as defined and limited in the standard real property and contents insurance forms approved by the commissioner. Essential property insurance may include coverage for either the actual cash value or replacement cost value of the structure and contents. Essential property insurance includes builders risks coverage. The extent of risk covered, the insuring language and the exclusions are all subject to approval by the commissioner. Policies, rules and rates shall be filed with the commissioner in the manner provided for insurance companies.
(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 commissioner pursuant to the provisions of this chapter.
(d) "Insurable property" means real property, and contents therein when requested, at fixed locations in the coast area, which property is determined by the association to be in an insurable condition and otherwise meets the underwriting requirements of the association. Any one- or two-family dwelling built, rebuilt, altered or remodeled in compliance with the applicable building codes, including design-wind requirements, that is not otherwise rendered uninsurable by reason of use, occupancy or state of repair, shall be an insurable risk. 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. "Insurable property" shall not include insurance on motor vehicles or creditor placed insurance on mobile homes. "Insurable property" includes mobile homes, modular homes or manufactured housing that are installed in compliance with applicable codes.
(e) "Commissioner" means the Insurance Commissioner of the State of Mississippi.
(f) "Coast area" means Hancock, Harrison, Jackson, Pearl River, Stone and George Counties.
(g) (i) "Net direct premiums," for purposes of calculating percentages of participation for assessable insurers for the year 2007, means gross direct premiums, excluding reinsurance assumed and ceded, written on property in this state for the risk of windstorm and hail less return premiums upon cancelled contracts, dividends paid or credited to policyholders, or the unused or unabsorbed portion of premium deposits. "Net direct premiums" includes the premium charge component for the risk of windstorm and hail to property in all policies, including multiperil and other policies that package or combine coverage for other risks. The plan of operation shall prescribe the portion of premium allocated for the risk of windstorm and hail in multiperil and other policies that package or combine coverage for other risks. "Net direct premiums" shall not include farm property. "Net direct premiums" shall not include the property components of motor vehicles and other mobile property, but includes premiums for the risks of windstorm and hail for mobile homes, modular homes or manufactured housing.
(ii) "Net direct premiums," for purposes of calculating percentages of participation for assessable insurers after the year 2007, means those premiums reported by the assessable insurers in their annual statements to the Department of Insurance that were charged for insurance for any and all risks on real property and contents in the state. The department shall determine which lines of real property and contents insurance shall be included in the calculation of net direct premiums. The included real property and contents insurance lines may be changed from time to time in the discretion of the commissioner. "Net direct premiums" shall not include premiums for insuring farm property that are reported timely to the association as provided in the plan of operation.
(iii) The commissioner is authorized and directed to provide to the association annual statements, other reports and any statistics necessary to provide the information herein required and which the commissioner is hereby authorized and empowered to obtain from any assessable insurer.
(h) "Farm property" means property used for farming purposes; however, it shall not include any property used for dwelling purposes or any outbuildings used in connection therewith.
(i) "Losses" includes expenses for the adjustment and resolution of claims and operational and other general expenses.
(j) "Bonds, loans, lines of credit and indebtedness" include interest, finance charges, and any and all other costs associated with the financing.
(k) "Percentage of participation" for an assessable insurer means the percentage determined by dividing the assessable insurers net direct premiums written in this state in the previous year by the aggregate net direct premiums written in this state by all assessable insurers of the association in the previous year. The percentage of participation may be modified as provided in Sections 83-34-9(3) and 83-34-13(2).
(l) "Nonadmitted insurers" means those insurance companies defined in Section 83-21-17, and any other companies and persons selling insurance on risks in Mississippi that are not licensed to do business in the State of Mississippi.
(m) "Agents placing insurance through nonadmitted insurers" means those agents defined in Section 83-21-19 and any other agents placing insurance through a nonadmitted insurer.
(n) "Assessable insurer" means each and every insurer authorized to write, and engaged in writing, property insurance within this state on a direct basis.
(o) "Minimum reserve" means an amount set forth in the plan of operation which is maintained by the association for the payment of salaries and other expenses necessary for the continuous and ongoing operation of the association.
(p) "Recoupable assessment" means any assessment, in whole or in part, that is levied on and payable by assessable insurers to the association which is directly recoverable from policyholders for any covered event. Any assessment levied due to a covered event occurring during the calendar year 2019 shall be a recoupable assessment.
(q) "Nonrecoupable assessment" means any assessment levied on and payable by assessable insurers to the association which is not directly recoverable from policyholders.
(r) "Excess deficit" means a deficit that exceeds available surplus, reinsurance, recoupable and nonrecoupable assessments and other reasonably available assets of the association. The minimum reserve, as set forth in the plan of operation, shall not be considered reasonably available assets of the association when determining whether an excess deficit has occurred.
(s) "Covered event" means an event, such as a hurricane, other windstorm or hailstorm, which causes losses covered by the policies issued by the association to its policyholders.
SECTION 15. This act shall take effect and be in force from and after July 1, 2025.