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HF 4960

as introduced - 93rd Legislature (2023 - 2024) Posted on 03/14/2024 02:35pm

KEY: stricken = removed, old language.
underscored = added, new language.

Current Version - as introduced

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A bill for an act
relating to insurance; authorizing insurers to use certain weather-related losses for
purposes of underwriting and rating; amending Minnesota Statutes 2022, sections
65A.29, subdivisions 7, 8; 70A.05.


Section 1.

Minnesota Statutes 2022, section 65A.29, subdivision 7, is amended to read:

Subd. 7.

Renewal; notice requirement.

new text begin (a) new text end No insurer shall refuse to renew, or reduce
limits of coverage, or eliminate any coverage in a homeowner's insurance policy unless it
mails or delivers to the insured, at the address shown in the policy, at least 60 days' advance
notice of its intention. The notice must contain the specific underwriting or other reason or
reasons for the indicated action and must state the name of the insurer and the date the notice
is issued.

new text begin (b) For purposes of this section and any rules adopted under subdivision 8, increasing
or revising a homeowner's insurance policy deductible due to claims arising from natural
causes, including but not limited to lightning, rain, wind, and hail, is not a refusal to renew,
a reduction in coverage limits, or an elimination of coverage.
new text end

new text begin (c) new text end Proof of mailing this notice to the insured at the address shown in the policy is
sufficient proof that the notice required by this section has been given.

Sec. 2.

Minnesota Statutes 2022, section 65A.29, subdivision 8, is amended to read:

Subd. 8.


(a) The commissioner may adopt rules pursuant to chapter 14, to specify
the grounds for nonrenewal, reduction in limits of coverage, or elimination of coverage of
a homeowner's policy. The rules must limit the grounds to the following factors:

(1) reasons stated for cancellation in section 65A.01, subdivision 3a;

(2) reasons stated in section 72A.20, subdivision 13;

(3) insured's loss experience, deleted text begin not to includedeleted text end new text begin includingnew text end natural causesnew text begin , which may include
but are not limited to lightning, rain, wind, and hail
new text end ; and

(4) other factors deemed reasonable by the commissioner.

The rules may give consideration to the form and content of the termination notice to
the insured, a statement as to what constitutes receipt of the termination notice, and the
procedure by which the insured may appeal a termination notice.

The rules adopted under this subdivision may provide for imposition of a monetary
penalty not greater than $500 per occurrence upon insurers who are found to be in violation
of the law or the rules.

(b) In addition to any rules adopted under this subdivision, an insured may appeal any
nonrenewal under this section to the commissioner of commerce. If the commissioner finds
that the nonrenewal is unjustified, arbitrary, or capricious, the commissioner shall order the
insurer to reinstate the insured's policy. The commissioner's order may be appealed pursuant
to chapter 14. The insured's policy shall continue in force pending the conclusion of the
appeal to the commissioner. The insurer must notify the insured of the insured's right to
appeal the nonrenewal to the commissioner in the notice of nonrenewal required under
subdivision 7.

Sec. 3.

Minnesota Statutes 2022, section 70A.05, is amended to read:


The compliance of rates with the standards of section 70A.04 shall be determined by
considering the following matters:

(1) Factors in rates. Due consideration shall be given to past and prospective loss and
expense experience within and outside this state, to a reasonable provision for catastrophe
hazards and contingencies, to clearly discernible trends within and outside this state, to
dividends or savings allowed or returned by insurers to their policyholders, members or
subscribers, and to all other relevant factors, including the judgment of underwriters and
ratersnew text begin and, with respect to new text end new text begin property and homeowners insurance, the impact of losses caused
by natural causes, including but not limited to lightning, rain, wind, and hail
new text end .

(2) Classification. Risks may be classified by any reasonable method for the
establishment of rates and minimum premiums. Classifications may not be based on race,
color, creed or national origin. Rates thus produced may be modified for individual risks
in accordance with rating plans or schedules which establish standards for measuring probable
variations in hazards, expenses, or both.

(3) Profits. The rates may contain an allowance permitting a profit that is not