AN ACT TO REDUCE THE IMPACT TO TAXPAYERS OF NATURAL DISASTERS AND OTHER INSURABLE RISKS BY ENHANCING INSURANCE COVERAGE FOR PUBLIC BUILDINGS.
Makes the following changes to Article 31, Insuring State Property, Officials and Employees, of GS Chapter 58.
Amends GS 58-31-1 to create the State Property Insurance Fund (Fund) for the purpose of providing a reserve against loss from fire and other perils as specified in the Article (was titled the State Property Fire Insurance Fund and only for a reserve against loss from fire). Makes technical deletions. Makes conforming changes throughout the Article.
Amends GS 58-31-5 to now require the Commissioner of Insurance (Commissioner) to annually file with the Department of Administration (was, for biennial appropriations) an estimate of the appropriations necessary to provide coverage sufficient to protect the State from loss or damage to any of its departments, institutions, and agencies up to 75% of their property value (was, up to 50% of their value). Adds a new requirement for the Commissioner to annually adjust the value of all State property covered by the State Property Insurance Fund by 2%. Makes technical and conforming changes.
Amends GS 58-31-10 to now require the Commissioner to purchase insurance or reinsurance from qualified insurers necessary to protect the Fund against loss on any one building and its contents in excess of $50,000 (previously, only authorized the Commissioner with the approval of the Director of the Budget and the Council of State to do so). Now specifies that the premiums for the coverage are to be paid by each requesting department, agency, or institution, with rates fixed by the Commissioner (previously, premiums were paid from the Fund). Removes the requirement to provide sprinkler leakage insurance upon request of any State agency or institution. Makes conforming changes.
Amends GS 58-31-12 to authorize the Commissioner to adopt insurance forms for coverages provided by the Fund, removing the qualification that approval of the Council of State is required.
Amends GS 58-31-15 to require every State department, agency, and institution to obtain extended coverage insurance and any other property insurance coverages that the Commissioner determines appropriate in light of the location, exposure to risk, age, and any other factors the Commissioner finds relevant to ensure appropriate coverage for the state-owned property insured by the Fund (previously, permitted the provision of extended coverage insurance and other property insurance upon request of any department, agency, or institution). Maintains the requirement for each respective department, agency, or institution to pay the premiums for this coverage at rates fixed by the Commissioner. Allows the Commissioner to purchase insurance or reinsurance that may be necessary to protect the Fund against loss with respect to the coverage from insurers admitted to do business in the state, removing qualification requiring approval of the Governor and Council of State. Now defines extended insurance coverage to include, but not be limited to, insurance against loss or damage caused by fire, lightning, windstorm, hail, explosion, riot, riot attending a strike, civil commotion, vandalism, water damage, aircraft, vehicles or smoke (previously, limited to the specified causes of loss or damage and did not include fire, lightning, vandalism, or water damage). Makes conforming changes.
Enacts GS 58-31-18 to require flood insurance to be provided on State-owned property of each department, agency, or institution insured by the Fund when the property is located or becomes located in an area identified on the latest Flood Insurance Rate Map as an area that will be inundated by the flood event having a 1% chance of being equaled or exceeded in any given year. Requires the respective department, agency or institution to pay the premiums of the coverage at rates fixed by the Commissioner. Authorizes the Commissioner to purchase insurance or reinsurance that may be necessary to protect the Fund against loss with respect to flood insurance coverage from insurers admitted to do business in the State.
Amends GS 58-31-20, concerning use and occupancy and business interruption insurance which can be provided to state-owned property insured by the Fund upon request. Removes the qualification for the Commissioner to obtain approval of the Governor and Council of State in order to purchase insurance or reinsurance necessary to protect the Fund against loss with respect to the coverage.
Makes the language in GS 58-31-25 and GS 58-31-35 gender-neutral.
Further amends GS 58-31-35 to clarify that officers and boards in custody of state-owned property have a duty to inform the Commissioner in a full and detailed description of the property and inform the Commissioner of any changes in the property, its location, or its surroundings.
Makes conforming changes to GS 147-69.2.
Effective March 31, 2021.