A bill for an act
relating to insurance; providing for certain premium discounts and rate reductions;
establishing a strengthen Minnesota homes program; establishing an account;
authorizing administrative rulemaking; proposing coding for new law in Minnesota
Statutes, chapter 65A.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
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(a) For purposes of sections 65A.60 to 65A.63:
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(1) "commissioner" means the commissioner of commerce;
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(2) "insurable property" means a residential property certified as meeting the Fortified
For Safe Living Standards (FFSLS), as may be adopted from time to time by the Institute
for Business and Home Safety (IBHS) or a successor entity, or the Fortified Commercial
Standard (FCS), as may be adopted from time to time by IBHS; and
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(3) "insurer" has the meaning given in section 65A.27, subdivision 5.
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(b) An insurer must provide a premium discount or insurance rate reduction in an amount
and manner as established in paragraph (h) for an insurable property. An insurer may offer
additional adjustments in deductibles, other credit rate differentials, or a combination thereof,
collectively referred to as adjustments. An adjustment must be made available under the
terms specified under this section to an owner who builds or locates a new insurable property
in Minnesota in order to resist loss due to catastrophic windstorm events.
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(c) An insurable property must be certified as conforming to FFSLS or FCS criteria only
after inspection and certification by an IBHS-certified inspector.
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(d) An owner of insurable property claiming an adjustment must maintain the IBHS
certification documentation, which is considered proof of compliance with the FFSLS or
FCS requirements.
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(e) The records required by this section are subject to audit by the commissioner or the
commissioner's representative.
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(f) Evidence of IBHS certification must be presented to the insurer or potential insurer
of a property owner before the adjustment becomes effective for the insurable property.
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(g) The records that must be maintained under paragraph (d) must be presented to the
insurer or potential insurer of a property owner before the adjustment becomes effective
for the insurable property.
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(h) An insurer required to submit rates and rating plans to the commissioner must submit
an actuarially justified rating plan for a person who builds an insurable property to comply
with this section. In addition to the requirements of this section, an insurer may voluntarily
offer a more generous mitigation adjustment that the insurer deems appropriate. An insurer
is prohibited from offering a mitigation adjustment that does not meet the minimum
requirements of this section.
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(i) The commissioner may adopt rules as necessary to implement this section.
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(a) An insurer must provide a premium discount or insurance rate reduction in an amount
and manner as established in paragraph (e) for an insurable property. An insurer may offer
additional adjustments in deductibles, other credit rate differentials, or a combination thereof,
collectively referred to as adjustments. An adjustment must be available under the terms
specified in this section to any owner who retrofits an insurable property located in Minnesota
in order to resist loss due to catastrophic windstorm events.
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(b) To obtain the adjustment provided in this section, an insurable property must be
retrofitted to the requirements in the Fortified Home: Highwind and Hail Standards (FHWH),
as may be adopted from time to time by the IBHS or a successor entity.
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(c) An insurable property must be certified as conforming to Fortified Commercial
Standard or Fortified Home requirements only after an IBHS-certified inspector inspects
and certifies the insurable property.
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(d) An owner of insurable property claiming an adjustment under this section must
maintain the IBHS certification documentation, which is considered proof of compliance
with the FCS or Fortified Home requirements described under paragraphs (b) and (c). The
certification must be presented to the insurer or potential insurer of a property owner before
the adjustment becomes effective for the insurable property.
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(e) An insurer required to submit rates and rating plans to the commissioner must submit
an actuarially justified rating plan for a person who retrofits an insurable property to comply
with the sets of alternatives provided in paragraph (b). The adjustment only applies 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 the premium for wind
coverage in the insurer's rate filing. The adjustment applies 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.
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(f) The commissioner may adopt rules as necessary to implement this section.
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(a) An insurer writing homeowners insurance must offer a fortified roof endorsement
to upgrade a nonfortified home that is otherwise eligible for a fortified standard to a fortified
standard identified under section 65A.61 when the insured home incurs damage covered
by the policy that requires the roof to be replaced. The endorsement must upgrade the
nonfortified home consistent with the fortified requirements for the geographic area in which
the nonfortified home is located.
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(b) The endorsement offer must be made at the time (1) a new policy on a nonfortified
home is written, and (2) upon first renewal of an existing policy on a nonfortified home.
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(c) For policies offered, issued, or renewed after January 1, 2026, an insurer must file
the insurer's endorsement form and accompanying rates for approval by the department.
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(d) The commissioner may adopt rules as necessary to implement this section.
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This section may be cited as the "Strengthen Minnesota
Homes Act."
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(a) For purposes of this section, the terms in this subdivision have
the meanings given.
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(b) "Commissioner" means the commissioner of commerce.
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(c) "Insurable property" has the meaning given in section 65A.60, paragraph (a).
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(d) "Program" means the Strengthen Minnesota Homes program established under this
section.
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The Strengthen Minnesota
Homes program is established within the department. The purpose of the program is to
provide grants to retrofit insurable property to resist loss due to common perils, including
but not limited to tornadoes or other catastrophic windstorm events.
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(a) A strengthen
Minnesota homes account is created as a separate account in the special revenue fund of
the state treasury. The account consists of money provided by law and any other money
donated, allotted, transferred, or otherwise provided to the account. Earnings, including
interest, dividends, and any other earnings arising from assets of the account, must be
credited to the account. Money remaining in the account at the end of a fiscal year does not
cancel to the general fund and remains in the account until expended. The commissioner
must manage the account.
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(b) Money in the account is appropriated to the commissioner to pay for (1) grants issued
under the program, and (2) the reasonable costs incurred by the commissioner to administer
the program.
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new text begin (a) A grant under this section must be used to retrofit