(A) In order to maintain stability in the property insurance market and to assure the continued, consistent availability of essential property insurance coverage in the coastal area, the Director of the Department of Insurance, who is selected as defined in Section 38-1-20(16), or his designee, by written order complying with the requirements of Section 1-23-140, may expand the coastal area in which the association shall provide essential property insurance for periods up to twenty-four months. The order is subject to renewal by the director but no renewal shall exceed twenty-four months. In determining whether expansion of the coastal area is warranted, the director or his designee shall consider:
(1) changes in the number of insurers writing essential property insurance in the seacoast area and the capacity of those insurers including, but not limited to, the number of policies those insurers have cancelled or nonrenewed, as provided in Sections 38-75-730, 38-75-740, and 38-75-1160, during the previous twelve months;
(2) changes in the extent to which (a) nonadmitted or surplus lines insurers, or (b) South Carolina Coastal Captive Insurance Companies, pursuant to Article 5, Chapter 90, Title 38, are providing essential property insurance in the seacoast area;
(3) changes in reinsurance activity impacting insurers writing essential property insurance in the seacoast area;
(4) changes in the demand for property insurance in the seacoast area; and
(5) any other information considered relevant to effectuate the purpose of this chapter including, but not limited to, the availability of essential property insurance coverage for insurable property that is within the coastal area and is located in a Coastal Barrier Resource Act (CBRA) zone.
(B) The director or his designee shall find and declare the existence of conditions that threaten to destabilize the property insurance market and jeopardize the continued, consistent availability of essential property insurance in the seacoast area. The director or his designee shall utilize market surveys, data calls, catastrophe models, reinsurance information, and other objective sources to support the order of expansion.
(C)(1) The director or his designee may expand the coastal area in which the association shall provide essential property insurance. The expansion may encompass a portion of the seacoast area or the entire seacoast area, but may not extend further than the seacoast area. The area must not be expanded more than reasonably necessary to ensure a stable property insurance market.
(2) In expanding the coastal area, the director or his designee may provide for the coastal area territory to be divided into multiple tiers to allow the association to develop multiple-tiered rates that reflect the relative risks of the properties located within a particular tier.
(3) An expansion of the coastal area is subject to the plan of operation as amended and approved by the director or his designee.
(4) The director or his designee shall report any expansion of the coastal area to the General Assembly within thirty days of the order of expansion or upon commencement of the next term of the General Assembly, if expansion occurs when the General Assembly is not in session. The General Assembly may approve, revise, or vacate any expansion order by passage of a joint resolution.
(D) On the effective date of this section, the General Assembly ratifies the director's May 23, 2007, coastal area expansion order and the multiple-tier structure described in the order for the time period stated in the order and authorized by this section.
HISTORY: 1988 Act No. 479, Section 3; 1993 Act No. 181, Section 793; 2003 Act No. 73, Section 20, eff June 25, 2003; 2007 Act No. 78, Section 10, eff June 11, 2007, applicable to taxable years beginning after December 31, 2006.
Editor's Note
Structure South Carolina Code of Laws
Chapter 75 - Property, Casualty, And Title Insurance Generally
Section 38-75-40. Validity of additional or coinsurance clause.
Section 38-75-50. Clause limiting or invalidating policies if property is encumbered is void.
Section 38-75-60. Cause of action by insurer against tenant.
Section 38-75-220. Restrictions on amount of insurance that may be written.
Section 38-75-230. Information required on contracts for purchase of mobile homes.
Section 38-75-310. Definitions.
Section 38-75-320. Declaration of purpose.
Section 38-75-330. South Carolina Wind and Hail Underwriting Association created; members.
Section 38-75-340. Plan of operation.
Section 38-75-350. Application for coverage; issuance of policy.
Section 38-75-360. Powers of Association.
Section 38-75-370. Duties of members of Association; limitation on liability.
Section 38-75-380. Liability for inspections and statements concerning risk.
Section 38-75-385. Liability for acts or omissions under this article.
Section 38-75-386. Essential property insurance; liability for acts and omissions.
Section 38-75-390. Cession of essential property insurance to Association.
Section 38-75-410. Appeals; hearings upon appeal.
Section 38-75-420. Reports of inspection by Association.
Section 38-75-440. Examination into affairs of Association.
Section 38-75-450. Regulations.
Section 38-75-470. Appointment of advisory committee; duties; membership.
Section 38-75-480. Loss mitigation grant program; establishment; purpose.
Section 38-75-485. South Carolina Hurricane Damage Mitigation Program; grant eligibility and use.
Section 38-75-710. Scope of article.
Section 38-75-720. Definitions.
Section 38-75-740. Restrictions on nonrenewal of policies.
Section 38-75-750. Requirements for renewal of policies.
Section 38-75-755. Notification to applicants or renewing policyholders.
Section 38-75-760. Unlawful practices involving cancellation, nonrenewal, or renewal of policies.
Section 38-75-770. Notice requirements for eligible surplus lines insurers.
Section 38-75-775. Coverage of licensed health care providers.
Section 38-75-790. Nonrenewal of homeowners insurance.
Section 38-75-905. Definitions.
Section 38-75-910. Limitation of risk on title insurance.
Section 38-75-920. Title insurers to maintain reinsurance reserve.
Section 38-75-930. Insolvency of domestic title insurer.
Section 38-75-940. Loss and loss expense reserves.
Section 38-75-950. Obtaining reinsurance.
Section 38-75-960. Financial interest in title insurer or agent.
Section 38-75-970. Premium rates.
Section 38-75-980. Filing of premium rate schedules.
Section 38-75-1000. Restrictions on amount of commission.
Section 38-75-1120. Report on coastal insurance issues.
Section 38-75-1130. Scope of article.
Section 38-75-1150. Separate premium for fire and allied lines coverage.
Section 38-75-1160. Notice requirement prior to cancellation or refusal to renew; exceptions.
Section 38-75-1180. Notice of reasons for cancellation or nonrenewal.
Section 38-75-1190. Immunity from liability absent malice or gross negligence.
Section 38-75-1200. Notice regarding cancellation in application for original issuance of policy.
Section 38-75-1230. Wind and hail exclusions on fire, allied lines, or homeowner's policy.
Section 38-75-1240. Provision to director of underwriting restrictions.