SB 962
Department of Legislative Services
Maryland General Assembly
2021 Session
FISCAL AND POLICY NOTE
First Reader
Senate Bill 962 (Senator Jackson)
Judicial Proceedings
Real Property – Satisfaction of a Mortgage – Required Homeowner’s Insurance
(Cassidy’s Law)
This bill requires an owner of residential real property in the State that is not subject to a
mortgage to maintain homeowner’s insurance with liability coverage of at least $100,000
for bodily or personal injury occurring on the property.
Fiscal Summary
State Effect: General fund revenues increase minimally from premium tax revenues
resulting from premiums for homeowner’s insurance policies required under the bill.
Expenditures are not affected.
Local Effect: None.
Small Business Effect: Potential minimal.
Analysis
Current Law: Insurance in the State is regulated by the Maryland Insurance
Administration (MIA), an independent agency headed by the Insurance Commissioner,
whom the Governor appoints with the advice and consent of the Senate. The two primary
types of insurance regulated by MIA are property and casualty insurance (including
homeowner’s insurance) and health insurance.
Insurance law establishes numerous requirements for homeowner’s insurance policies,
including the factors that an insurer make take into consideration when rating a policy and
procedures an insurer must follow when cancelling a policy. State law does not require a
consumer to purchase a homeowner’s insurance policy either concurrent with a mortgage
or without a mortgage. (However, under the Real Property Article, the bylaws of a
condominium may require a unit owner to maintain a condominium unit owner insurance
policy.) Even so, lenders that issue mortgages typically require the buyer to purchase and
maintain homeowner’s insurance while the mortgage is in effect as part of the loan contract.
Title 6 of the Insurance Article imposes a 2% premium tax on each authorized insurance
company, surplus lines broker, or unauthorized insurance company that sells, or an
individual who independently procures, any type of insurance coverage upon a risk that is
located in the State. Revenues accrue to the general fund.
Additional Information
Prior Introductions: None.
Designated Cross File: None.
Information Source(s): Office of the Attorney General (Consumer Protection Division);
Judiciary (Administrative Office of the Courts); Maryland Department of Labor; Maryland
Insurance Administration; Department of Legislative Services
Fiscal Note History: First Reader - March 29, 2021
rh/jc
Analysis by: Richard L. Duncan Direct Inquiries to:
(410) 946-5510
(301) 970-5510
SB 962/ Page 2


Statutes affected:
Text - First - Real Property – Satisfaction of a Mortgage – Required Homeowner’s Insurance (Cassidy’s Law): 14-133 Real Property