Bill would require more notice before insurers drop coverage

Times Daily (Florence, AL)

MONTGOMERY — Insurance companies in Alabama would have to provide at least a 90-days notice before canceling, reducing or not renewing a property owner's coverage, according to a bill pre-filed for the 2024 legislative session.

The bill from Rep. Chip Brown, R-Hollingers Island, would triple the current notice requirement of 30 days, according to the Alabama Department of Insurance.

"It is, in my opinion, a pro-consumer piece of legislation and it's just common sense and the right thing to do," Brown told Alabama Daily News on Thursday.

The bill also requires insurers to wait at least 90 days after a property was fully repaired from hurricane damage, wind loss or other emergency declarations before canceling or not renewing residential or commercial insurance policies.

"If you have a damaged home, you're not going to be able to get coverage," Brown said.

Policies have been canceled in Alabama after natural disasters, including the deadly 2011 tornadoes.

Brown told Alabama Daily News that after hurricanes Katrina and Ivan, several companies "canceled policies on people just on a whim."

He doesn't want that to happen again the next time a major storm impacts Alabamians.

"We have to play offense and be prepared," he said.

Jennifer Bowen, a spokesperson for the Alabama Department of Insurance, said the agency believes "Rep. Brown's bill is good for Alabama consumers and it has our support."

In several states, insurers have recently stopped issuing new policies. Over the summer, major insurers reduced their coverage in California and Florida, which have seen an increase in wildfires and major storms in recent years.

According to NBC News, more than a dozen insurers have decided to no longer write new business in Florida, alongside at least six companies that became insolvent in 2022 alone.

National Public Radio reported earlier this year about how canceled private policies had people turning to the state-backed insurer.

The Alabama Legislature's 2024 session starts Feb. 6.