230-RICR-20-05-11
230-RICR-20-05-11. Basic Property Insurance Inspection and Placement Program (version Amendment, 07/01/2004 to 04/15/2009)
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Reg. # 15
State of Rhode Island and Providence Plantations
DEPARTMENT OF BUSINESS REGULATION
Division of Insurance
233 Richmond Street
Providence, RI 02903
INSURANCE REGULATION 15
BASIC PROPERTY INSURANCE INSPECTION AND PLACEMENT
PROGRAM
Table of Contents
Section 1
Authority
Section 2
Purpose
Section 3
Definitions
Section 4
Inspections and Reports
Section 5
Provisional Binders
Section 6
Limits of Coverage and Deductibles
Section 7
Policy Issuance/Declination
Section 8
Reasonable Underwriting Standards
Section 9
Participation of Member Companies
Section 10
Authority to Issue Policies on Behalf of Members
Section 11
Rates and Forms
Section 12
Cancellation and Nonrenewal
Section 13
Right of Appeal
Section 14
Commissions
Section 15
Coding and Reports
Section 16
Administration
Section 17
Annual and Special Meetings
Section 18
Duties of the Committee
Section 19
Public Education
Section 20
Termination of the Program
Section 21
Severability
Section 22
Effective Date
Section 1
Authority
This Regulation is promulgated in accordance with R.I. Gen. Laws § 27-33-11
and 42-14-17.
Section 2
Purpose
The purpose of this Regulation is to implement the Basic Property Insurance
Inspection and Placement Program (hereinafter “this Program”) as follows:
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(1)
To make Basic Property Insurance available to qualified applicants who
have been unable to secure such insurance in the normal market, subject to
the conditions hereinafter stated.
(2)
To mandate the participation of all domestic Insurers and all Insurers
licensed to write those classes of insurance listed in R.I. Gen. Laws §§ 27-
8-1 and 27-8-3 in the State of Rhode Island and to equitably apportion and
distribute the writings, expenses, profits, if any, and losses of this Program
among Insurers licensed to write Basic Property Insurance, as defined
herein, in this State.
(3)
To encourage the improvement of properties located in urban areas and to
further orderly community development.
(4)
To make public the purposes and procedures of this Program.
Section 3
Definitions
(1)
"Basic Property Insurance" shall mean, in addition to any and all
coverages specifically enumerated in R.I. Gen. Laws § 27-33-10,
insurance against direct loss to property as defined and limited in standard
fire policies in (1) extended coverage; (2) vandalism and malicious
mischief; (3) sprinkler leakage endorsements thereon; (4) homeowners
package coverage on owner-occupied habitational risks for one to four
families, and for homeowners tenants forms; (5) the liability coverages for
one to four family owner and non-owner occupied dwellings, either as a
personal liability endorsement to a dwelling property policy or as a "stand
alone" dwelling liability policy; and (6) lead liability insurance for any
pre-1978 residential rental property, either by endorsement to a
homeowners or dwelling liability policy or as a "stand alone" lead
poisoning liability insurance policy. It shall not include automobile or
farm risks, with the exception of lead liability coverage as a "stand alone"
policy for farmowners dwellings.
(2)
"Commissioner" means the Insurance Commissioner of the State of Rhode
Island.
(3)
"Insurer" shall mean any insurance company or other organization
licensed to write, and writing property or liability insurance business,
including the property and liability components of multi-peril policies, on
a direct basis in this state who is a member of the Rhode Island Joint
Reinsurance Association.
(4)
"Producer" means licensed insurance producer, as defined in R.I. Gen.
Laws § 27-2.4-1 et seq.
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(5)
"Program" means the Basic Property Insurance Inspection and Placement
Program as set forth in this Regulation.
(6)
"Premiums Written" shall mean gross direct premiums written during the
most recent calendar year for which data is available, as determined by the
Association, with respect to property in this State on all property and
liability policies (excluding "Flood", as written by the National Flood
Insurance Program), including all homeowners policies and the fire, other
allied lines and liability components of all dwelling policies and
commercial multi-peril policies, as computed by the Association, less
return premiums, dividends paid or credited to policyholders, or the
unused or unabsorbed portion of premium deposits.
(7)
" Rhode Island Joint Reinsurance Association" and the “Rhode Island
FAIR Plan” (Fair Access to Insurance Requirements), and the
“Association” shall be considered synonymous and herein referred to as
the Association and means the organization formed by Insurers to
administer this Program herein set forth.
Section 4
FAIR Plan Business -- Inspection and Reports
(1)
Any applicant may submit to the Association directly or through a
licensed Producer designated by the applicant a completed application for
a property inspection and insurance coverage or for immediate
certification insurance coverage on a form prescribed by the Association,
specifying the requested effective date for such coverage.
(2)
The Association shall have the right to inspect any property, on which
immediate coverage is not requested, before accepting or declining
coverage, provided that the Association may decline coverage if the
application discloses that the property or applicant fails to meet the
underwriting standards and other requirements of this Program, as set
forth in this Regulation, without the need for an inspection.
(a)
The inspection shall be scheduled promptly and shall cover the
construction, maintenance, materials and occupancy characteristics
of the property and any other conditions, which increase the risk of
loss or render it uninsurable. Photographs may be taken during the
inspection to document observable conditions.
(b)
Except as provided in this Section, when the inspection is
completed the Association shall accept or reject the application. If
the application is rejected, the Association shall notify the
applicant and Producer in writing of its reasons and shall provide
to the applicant and Producer a copy of the Inspection Report,
without charge, upon request. If the application is conditionally
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declined, the Association shall also give the applicant an
opportunity to correct any physical conditions indicated on the
written notification before making the declination final.
(3)
When a completed application for immediate coverage is submitted, and
approved, the Association shall accept or reject the application without
first performing an inspection, and, if accepted, issue a policy of Basic
Property Insurance under this Program. The Association shall have the
right to limit the amount of lead liability coverage provided to an applicant
under the immediate coverage procedure.
(a)
The inspection shall be scheduled promptly and shall cover the
construction, maintenance, materials and occupancy characteristics
of the property and any other conditions, which increase the risk of
loss or render it uninsurable. Photographs may be taken during the
inspection to document observable conditions.
(b)
If the inspection reveals conditions which make insurance
coverage with the Plan unavailable pursuant to the Underwriting
Standards detailed in Section 8 of this Regulation, the Association
shall notify the applicant/insured and the Producer in writing of the
conditions rendering the property ineligible and shall provide to
the applicant/insured and Producer a copy of the Inspection Report,
without charge, upon request, and shall give the applicant/insured
an opportunity to correct the condition before canceling the policy.
(4)
The owner of any building or condominium unit or any tenant seeking
insurance coverage shall provide full access to the property, upon request
by the Association, for purposes of a physical inspection.
(5)
The inspection will be without cost to an applicant.
(6)
The manner and scope of the inspection shall be prescribed by the
Association.
Section 5
Provisional Binders
To prevent lapses of insurance coverage for risks eligible under this Program
before coverage has been made available or declined, a provisional binder affording the
insurance requested, subject to all provisions of this Program, including but not limited to
a subsequent inspection of the property and compliance with the underwriting standards
and other Program requirements, will be automatically issued if:
(1)
Through no fault of the applicant, coverage has not been either offered or
denied within twenty (20) calendar days after the date the request for
inspection was received by the Association; and
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(2)
The applicant, at the time of requesting the inspection or at any time prior
to the receipt of a written statement indicating that the property is
uninsurable, pays the estimated annual premium or deposit premium.
The Association shall thereafter promptly conduct an inspection of the property as
provided in Section 4 above and may decline to continue or cancel any provisional
coverage, unless the applicant corrects any conditions which increase the risk of loss or
render the property uninsurable under this Program. Coverage provided under this
Provisional Binder provision shall be at the rates approved by the Commissioner for the
class of property to be insured, exclusive of any surcharge, but shall be subject to an
appropriate premium adjustment, if necessary, after the property has been inspected.
Section 6
Limits of Coverage and Deductibles
(1)
Limits of coverage shall be established in rules adopted by the Governing
Committee subject to approval by the Commissioner.
(2)
Standard and percentage deductibles, percentage participation clauses, and
other underwriting devices may be imposed by the Association on any
commercial, or non-owner occupied residential risk to meet special
problems of insurability. In addition, the Association may require large or
special deductibles on a “consent to rate basis” subject to approval by the
Commissioner.
(3)
The Association may impose deductibles on all other risks only if there
has been excessive loss frequency and the applicant has failed to take
reasonable steps to correct any situation which has given rise to past
losses. The deductibles used by the Association will either be those
approved by the Commissioner for use by all insurers or those specifically
approved by the Commissioner for the Association. The Association may
impose other deductibles with the approval of the Commissioner.
(4)
No applicant shall be eligible to obtain lead liability limits in excess of the
amount of the applicant’s general liability limits, subject to the further
restriction that an applicant may not obtain lead liability coverage above
the maximum limits established by the Governing Committee and
approved by the Commissioner. Additionally, an applicant who does not
produce valid and in force Prima Facie Evidence of Compliance issued
pursuant to R.I. Gen. Laws § 42-128.1-9 may obtain less lead liability
coverage than the amount of insurance offered by the Association,
provided however that such an applicant shall not be entitled to an amount
of insurance that is less than the minimum limits offered by the
Association.
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Section 7
Policy Issuance/Declination
(1)
Upon approval by the Association of an application for coverage, or
renewal of coverage, and upon receipt by the Association of the full
amount of the required premium, (or if the applicant chooses an approved
installment payment plan, the full amount of the deposit premium) in cash,
or by personal check, certified check, bank check, money order, postal
money order, or the check of a licensed lending institution, the
Association shall issue a policy in accordance with Section 10.
(2)
Applications for coverage shall be declined where the property fails to
meet reasonable underwriting standards of the Association as set forth in
Section 8 below or other requirements of the Association or this Program.
(3)
In the event of declination, the applicant shall be furnished a written
statement of the conditions which make the property uninsurable and the
measures, if any, which if taken would make the property insurable, or a
written statement of any other reasons for declination. The applicant shall
also be informed of his or her right to appeal such determination by the
Association and be advised of the means whereby such an appeal may be
initiated in accordance with Section 13 of this Regulation.
Section 8
Reasonable Underwriting Standards
(1)
In determining whether or not to accept the risk, the Association shall
follow reasonable underwriting standards which shall include, but not be
limited to, the following:
(a)
The right to decline or cancel insurance because of the physical
condition of the property, such as its construction, heating, wiring,
evidence of unrepaired damage or general deterioration (however,
the mere fact that a property does not satisfy all current building
code specifications would not, in itself, justify declining the risk);
(b)
The right to decline or cancel insurance because of the present use
or housekeeping of the property, such as abandonment, vacancy,
overcrowding, excessive rubbish or improper storage of flammable
materials;
(c)
The right to decline or cancel insurance because of other specific
characteristics of ownership, condition, occupancy, or maintenance
which are violative of law or public policy and which result in
unreasonable exposure to loss;
(d)
The right to decline or cancel insurance on buildings in which any
one of the following exists:
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1.
Failure to pay real estate taxes on the property after the
taxes have been delinquent for one (1) year or more (real
estate taxes shall not be deemed to be delinquent for this
purpose even if they are due and constitute a lien, so long
as a grace period remains under local law during which
such taxes may be paid without penalty);
2.
Failure, within the insured's control, to furnish heat, water,
sewer services or public lighting for thirty consecutive days
or more;
3.
Failure within a reasonable time to correct conditions
dangerous to life, health or safety.
(e)
The right to decline or cancel insurance on property:
1.
Where, because of physical conditions, there is an
outstanding demolition order, outstanding order to vacate
or which has been declared unsafe or uninhabitable in
accordance with law;
2.
Where fire damage exists and the owner has not taken
reasonable steps to protect and secure the property;
3.
Where, following a fire, permanent repairs have not
commenced within sixty (60) days after satisfactory
adjustment of loss; or
4.
Where fire damage exists and the insured has stated or such
time has elapsed as clearly indicates that the damage will
not be repaired.
(f)
The right to decline or cancel insurance where the applicant is in
arrears in the payment of insurance premiums to a licensed
Producer or insurer for the types of coverage which are offered by
the Association;
(g)
The right to decline or cancel insurance on any building where it is
vacant or where sixty five percent (65%) of the building is
unoccupied, unless the building is undergoing rehabilitation. Upon
request, the Association must be provided with a schedule for such
rehabilitation;
(h)
The right to decline or cancel insurance on any building which has
been abandoned or where there has been removal of fixtures or
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salvageable material from the building and the owner can give no
reasonable explanation for such removal;
(i)
The right to decline or cancel insurance where reliable information
is secured indicating that the property will be burned for the
purpose of collecting insurance on the property;
(j)
The right to decline or cancel insurance where the applicant,
insured, mortgagee, loss payee, or any other person having a
financial interest in the property is convicted or where an
unresolved indictment for the crime of arson or for a crime
involving a purpose to defraud an insurance company exists;
(k)
The right to decline or cancel insurance where the property has
been subject to more than two (2) fires, each loss amounting to one
percent (1%) of the insurance in force, in any twelve (12) month
period; or more than three (3) such fires in any twenty four (24)
month period, provided that the cause of such fires is due to
conditions which are the responsibility of the owner-named
insured;
(l)
The right to decline or cancel insurance in those instances where
the Association has information which indicates that a moral
hazard exists.
(2)
The Association shall not decline or cancel any risk for reasons of
neighborhood or area location or any environmental hazard beyond the
control of the property owner.
(3)
Reasonable underwriting standards with respect to any liability insurance
policy form or endorsement offered by the Association and Section II of
homeowners insurance shall include the general standards and, in addition,
shall include, but not be limited to, the following:
(a)
Hazardous physical conditions including, but not limited to,
unfenced swimming pools;
(b)
Presence of vicious animals;
(c)
Excessive loss frequency when the applicant has failed to take
reasonable steps to correct any situation which has given rise to
past losses.
(4)
The Association shall have the right to decline or cancel, non-renew or
withdraw lead liability coverage of residential rental property owners who
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are ineligible for such coverage in accordance with Section 10 of
Insurance Regulation 101, as follows:
(a)
A residential rental property owner who fails to remediate lead
violations which occur after June 30, 2004 on any property within
ninety (90) days of the issuance of a notice of violation.
(b)
A residential rental property owner who owns only one (1)
property and has more than one (1) unremediated dwelling unit at
which a child was poisoned prior to July 1, 2004.
(c)
A residential rental property owner who owns two (2) or more
properties and has more than two (2) unremediated dwelling units
at which a child was poisoned prior to July 1, 2004.
(5)
The right on the part of the Association to apply by endorsement in
accordance with the waiver provisions of the statutory standard fire
insurance policy of the State of Rhode Island a "Modern Materials"
provision which would permit repairs with modern materials, not
necessarily those of like kind and quality, provided the structure's
integrity, utility and value are not impaired, and that the policyholder
declines to insure the risk to its replacement cost value or a percentage
thereof as required to qualify for coverage under the special loss
settlement endorsement.
Section 9
Participation of Member Companies
(1)
The Association may purchase reinsurance including catastrophic
coverage.
(2)
Each Insurer shall participate in the writings, expenses, profits, if any, and
losses of the Association in the same proportion as its Premiums Written
bear to the aggregate Premiums Written by all Insurers in this Program.
(3)
The Governing Committee, acting on behalf of the Association, shall be
authorized to make a preliminary assessment upon all Insurers and such
further assessments as may be deemed necessary, with respect to any
policy year.
(4)
The Association shall distribute to the Commissioner and to each insurer
its calculation of the insurer’s participation ratio for each policy year. The
insurer shall notify the Association in writing within thirty (30) days from
the date of mailing by the Association of any objection it may have to such
calculation. If the Association does not receive any objection within such
thirty (30) day period, the calculation shall be binding upon the insurer.
Until the Association has received the necessary data to calculate a
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participation ratio for any year, it may use the participation ratio calculated
for the prior policy year on a provisional basis, but shall adjust any
assessments made on the basis of such provisional ratios when final
participation ratios for the year are calculated.
Section 10
Authority to Issue Policies on Behalf of Members
(1)
The Association shall be authorized (a) to issue policies or certificates of
insurance in the name of the Association for risks found insurable by the
Association under this Program and (b) to provide for the investigation
and adjustment of claims, defense of policyholders, payment of losses and
all such other functions as are usual in servicing the insured under such
policies, and (c) to otherwise incur expenses consistent with the goals of
this Program and the interests of the Association, its members, and its
insureds. Each insurer irrevocably designates the Association as its agent
in carrying out such functions.
(2)
Each insurer shall be a direct insurer under each policy or certificate of
insurance issued by the Association during any calendar year to the extent
of its participation for that year as determined in accordance with Section
9 of this Regulation. Liability of each insurer shall be several, each for
itself, and not joint, and no insurer shall be liable under any such policy or
certificate for the liability of any other insurer thereunder, except as
provided in Article VII of the Articles of Agreement in case of the
insolvency of a insurer.
(3)
The Governing Committee shall from time to time designate in writing
one or more persons to act as attorney-in-fact for all companies to execute
policies on behalf of the insurers. No policy or certificate of insurance
shall be affected or invalidated by any change of the attorney-in-fact who,
at the time such policy or certificate of insurance was issued, shall have
duly acted pursuant to the powers in him or her then vested. Any policy or
certificate of insurance issued pursuant to this Section may be executed on
behalf of the insurers by any attorney-in-fact appointed hereunder, and
each insurer agrees to be bound thereby to the extent of its participation in
the writings of the Association, as determined under Section 9 of this
Regulation.
Section 11
Rates and Forms
(1)
All policies shall be for Basic Property Insurance on standard policy forms
and shall be issued for a term of one year.
(2)
The Association shall use such forms and rules consistent with this
Program, as may be filed by or on its behalf and approved by the
Commissioner.
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(3)
(a)
Premiums for policies shall be calculated in accordance with
classifications, rates and rating plans filed by or on behalf of the
Association and approved by the Commissioner. The
Commissioner shall approve rates filed by the Association based
upon the standard that the rates shall not be excessive, inadequate
or unfairly discriminatory, giving due consideration to the past and
prospective loss and expense experience for Basic Property
Insurance, written in this state, trends in the frequency and severity
of losses, the investment income of the FAIR Plan and such other
information as the Commissioner may require. All rates shall be
calculated to be self-supporting consistent with sound actuarial
principles. Rates for Basic Property Insurance shall be approved
by the Commissioner, notwithstanding any limits on rate approval
authority. Nothing in this section shall be deemed to affect the
duty of licensed insurers in the State of Rhode Island to participate,
as needed, on a direct basis, in this Program pursuant to R.I. Gen.
Laws §§ 27-33-2 and 27-33-11 and any rules and regulations
promulgated thereunder, and to pay their proportionate share of
losses and expenses incurred by this Program upon assessment by
the Program.
(b)
In addition to the above, rates for lead poisoning liability coverage
shall also be subject to the standards set forth in R.I. Gen. Laws
§42-128.1-9(e).
(4)
Return premium on all policies shall be calculated on a pro-rata basis,
effective as of the date of cancellation of the policy.
Section 12
Cancellation
(1)
All Insurers participating in this Program and the Association on their own
business shall give thirty (30) days notice prior to cancellation or non-
renewal of any risk eligible under this Program except in the following
cases:
(a)
Owner or occupant incendiarism;
(b)
Material misrepresentation;
(c)
Non-payment of premium;
(d)
At least sixty five percent (65%) of the rental units in the building
are unoccupied, and the insured has not obtained prior approval
from the participating Insurer or the Association of a rehabilitation
plan which necessitates a high degree of unoccupancy;
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(e)
Loss or damage exists and the insured has stated or such time has
elapsed as clearly indicates that the damage will not be repaired;
(f)
Following a loss, permanent repairs following satisfactory
adjustment of loss have not commenced within sixty (60) days;
(g)
Property has been abandoned or there has been removal of
undamaged salvageable items from the building and the insured
can give no reasonable explanation for such removal;
(h)
Utilities such as electric, gas, or water services have been
disconnected and the insured has failed to pay his account for such
services within one hundred twenty (120) days, or real estate taxes
have not been paid for a two (2) year period after the taxes have
become delinquent (real estate taxes shall not be deemed to be
delinquent for this purpose even if they are due and constitute a
lien, so long as a grace period remains under local law during
which such taxes may be paid without penalty).
(i)
Where reliable information that good cause exists to believe that
the building will be burned for the purpose of collecting the
insurance on the property;
(j)
Conviction or unresolved indictment of a named insured or loss
payee or any other person having a financial interest in the
property of the crime of arson or crime involving a purpose to
defraud an insurance company;
(k)
Where the building has been subject to more than two (2) fires,
each loss amounting to at least one percent (1%) of the insurance
in force in any twelve (12) month period; or more than three (3)
such fires in any twenty four (24) month period, provided that the
cause of such fires is due to conditions which are the responsibility
of the owner-named insured;
(l)
Any reason which would have been grounds for declination of the
risk under Regulation 15 if such reason had been known or had
been present at the time of acceptance and becomes known or
present during the policy period.
(m)
Any reason which renders a residential rental property owner
ineligible for lead liability coverage under Section 10 of Insurance
Regulation 101 shall be grounds to cancel or non-renew a policy
which provides lead liability coverage, as follows:
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(1)
A residential rental property owner who fails to remediate
lead violations which occur after June 30, 2004 on any
property within ninety (90) days of the issuance of a notice
of violation.
(2)
A residential rental property owner who owns only one (1)
property and has more than one (1) unremediated dwelling
unit at which a child was poisoned prior to July 1, 2004.
(3)
A residential rental property owner who owns two (2) or
more properties and has more than two (2) unremediated
dwelling units at which a child was poisoned prior to July
1, 2004.
(2)
When a policy is cancelled or non-renewed, other than for non-payment of
premiums or the insured's having obtained substitute coverage or if the
policy had been issued through the Association, the insurer shall notify the
insured and the insured’s producer, if any, of possible eligibility for
insurance through the Association. Such notice shall accompany or be
included in the cancellation or non-renewal notice. The notice must be
clearly identifiable by the insured. The notice must provide information
on how to contact the Association, including address and telephone
number(s), including a toll free number, and, alternatively, to contact a
licensed insurance producer for assistance in obtaining coverage through
the Association.
(3)
Any cancellation upon less than thirty (30) days notice arising out of any
of the conditions listed above of this section shall follow a procedure
which includes as a minimum, notification to the insured by the
Association of the cancellation, with a copy to the Commissioner, giving
the reasons for the action and setting forth the insured's right to appeal to
the Commissioner for review of the cancellation. The cancellation shall
stand unless the Commissioner rules otherwise.
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Section 13
Right of Appeal
Any applicant for insurance and any person insured under this Program may
appeal to the Governing Committee within fifteen (15) days after mailing of notice of any
final underwriting ruling, action, or decision of the Association. The Governing
Committee shall issue its decision without undue delay. Any decision of the Committee
may be further appealed to the Commissioner within thirty (30) days. Orders of the
Commissioner shall be subject to judicial review pursuant to R.I. Gen. Laws § 42-35-15.
Section 14
Commissions
(1)
Commissions to the licensed Producer designated by the applicant shall be
set by the Governing Committee with approval of the Commissioner.
(2)
In the event of cancellation of a policy, or if an endorsement is issued
which requires premium to be returned to the insured, the Producer shall
refund ratably to the Association commissions on the unearned portion of
canceled liability and on reductions in premiums at the same rate at which
such commissions were originally paid.
(3)
All Insurers shall solicit the cooperation of their agents with this Program
and no Producer shall be penalized for submitting risks to the Association.
Section 15
Coding and Reports
(1)
Business written pursuant to this Program shall be regarded as a separate
kind or class of business for statistical purposes and shall be separately
coded.
(2)
The Association shall submit periodic reports to the Commissioner, as the
Commissioner may request, setting forth the number of requests for
inspection, the number of risks inspected, and the results of inspections by
the Association together with such other information as the Commissioner
may request.
(3)
The Association shall submit annual reports to the Commissioner in
accordance with and setting forth the information required under
Insurance Regulation 101(9)(C).
Section 16
Administration
(1)
This Program shall be administered by a Governing Committee
(hereinafter referred to as the Committee), subject to the supervision of the
Commissioner.
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(2)
The Governing Committee shall consist of eighteen (18) members. Ten
members of the Committee shall be Insurers, at least two (2) of which
shall be domestic Insurers. These members shall be elected annually by
cumulative voting of the Insurers of the Association whose votes shall be
weighed in accordance with the proportion that each Insurer's Premiums
Written in the state during the most recent calendar year for which data is
available bears to the aggregate premiums written by all Insurers in this
Program. Not more than one (1) Insurer in a group under the same
management or ownership shall serve on the Committee at the same time.
Six (6) members of the Governing Committee shall be individuals who are
not employed by or otherwise affiliated with Insurers, Producers or other
entities of the insurance industry. These members shall be appointed
annually by the Chair of the Committee. The Committee shall also include
two (2) members who shall be licensed resident fire and casualty
Producers in the State of Rhode Island. Both of the aforementioned
licensed fire and casualty Producers shall be appointed by the Independent
Insurance Agents of Rhode Island.
Section 17
Annual and Special Meetings
(1)
Meetings -- The annual meeting of the Insurers for the election of the
Committee and such other business as may be necessary shall be held in
the State of Rhode Island on a date fixed by the Governing Committee. At
any regular or special meeting at which the vote of the Insurers is or may
be required on any proposal, voting may be in person or by proxy. Voting
at regular or special meetings, or any vote of the Insurers which may be
taken by mail, shall be cast and counted on a weighted basis in the same
proportion as each Insurer's Premiums Written bear to the aggregate
Premiums Written by all Insurers in this Program. Notice of meetings of
the Insurers shall be given by the Secretary and shall state the time, date
and place and the principal purposes thereof. Such notice may be given to
the Insurers by electronic mail or any other reasonable widely used
electronic format or by regular US Postal mail.
(2)
As soon as practicable after election to membership on the Committee,
and thereafter from time to time as it may elect, an Insurer shall designate
a qualified representative and an alternate of such representative to serve
for it and shall immediately notify in writing the Manager of the
Association of such designation.
(3)
Officers -- The Committee shall elect a Chair, Vice Chair, Secretary,
Treasurer, and Manager.
(a)
The Chair shall preside over all meetings of this Committee and at
all meetings of the Insurers which are Members of the Rhode
Island Joint Reinsurance Association. The Chair shall discharge
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such other duties as may be incidental to his office or as shall be
required by these rules or by the Committee.
(b)
The Vice Chair shall preside at any meeting of the Committee in
the absence of the Chair. In the event of death, incapacity, or
disability of the Chair, the Vice Chair shall perform the duties of
the Chair until such office has been filled by the Committee.
(c)
The Secretary shall issue all notices of meetings, record minutes of
all meetings, keep the records of the Committee, and discharge
such other duties as may be incidental to the office or as shall be
required by these rules or by the Committee.
(d)
The Treasurer shall discharge such duties as may be incidental to
the office or as shall be required by these rules or by the
Committee.
(e)
The Manager shall discharge such duties as may be incidental to
the office or as shall be required by these rules or by the
Committee.
(4)
Special Meetings -- Special Meetings of the Committee or of the Insurers
may be held upon the call of the Chair or in the event of resignation,
death, or incapacity, upon the call of the Vice Chair. Any six (6) members
of the Committee, acting by their designated representatives, may request
the Chairman to call a meeting of the Committee and any six (6) Insurers
may request the Chair to call a meeting of the Membership at such time
and place and for such purposes as may be set out in writing in such
request. Should the Chair decline to call such meetings, the same may be
called by the six (6) members making the request. Such special meetings
may be held at the principal office of the Association or at such other
place within or without the State of Rhode Island as may be designated in
the call.
(5)
Notices of Committee Meetings -- Notices of all Committee meetings
shall be given by the Secretary to the members of the Committee and to
the Insurers, and shall state the time and place and the principal purposes
thereof, in order to legally constitute the meeting, provided a majority of
the designated representatives of the Insurers shall be present at such
meeting. Such notices may be given to the members of the Committee by
electronic mail or any other reasonable widely used electronic format or
regular US postal mail, and in the case of Insurers directed to the attention
of the designated representatives of the Insurers and shall be sent or
mailed at least ten (10) days in advance of the meeting. Any Insurer or the
designated representative of any Insurer may waive notice of any meeting,
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and the presence of such representative at any meeting shall constitute a
waiver of notice as to such Insurer.
(6)
Advance Agenda -- The Secretary, after consultation with the Chair, shall
prepare in advance of each meeting of the Committee and each meeting of
the Insurers an agendum which, with such supporting data and information
as may be conveniently assembled, shall be forwarded to the members of
the Committee or their designated representatives or to the Insurers, as the
case may be, in advance of any such meeting.
(7)
Committees -- Subject to the Articles of Agreement, the Chair of the
Committee may appoint or the Committee may elect such standing
committees or such temporary or special committees as may be deemed
necessary for the transaction of its business.
(8)
Ex-Officio Members -- The Chair of the Committee shall be an ex officio
member of all standing or special committees, with right to vote.
(9)
Voting by Committee – Every committee member shall have one (1) vote.
Any matter submitted to the Committee shall be carried if it is voted in the
affirmative by a majority of the committee members present at a meeting
or attending by teleconferencing, provided at least a quorum is
participating. Committee voting shall be permitted only by the designated
representatives or alternates of the committee members and by the public
committee members and Producer committee members in person at a
meeting of the Committee, by teleconference or by mail, in accordance
with this Section. Voting by mail is permitted, provided that any matter
submitted for a mail vote shall carry only if it is voted in the affirmative
by a majority of the total number of committee members and receives no
negative vote.
Section 18
Duties of the Committee
(1)
The Committee shall meet as often as may be required to perform the
general duties of the administration of the Association. Ten (10) members
of the Committee shall constitute a quorum.
(2)
The Committee shall be empowered: to appoint or otherwise contract for
the services of a Manager; to budget expenses; to levy assessments
including preliminary assessments provided herein, or necessary or
incidental to the administration of this Program.
(3)
Annually the Manager shall prepare an operating budget which shall be
subject to approval of the Committee.
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(4)
The Committee shall furnish to all Insurers and to the Commissioner a
written report of operations annually in such form and detail as the
Committee may determine.
Section 19
Installment Payment Plan
The Association may offer applicants, on a nondiscriminatory basis, the option to
pay premiums on an installment payment plan, consistent with plans offered to insureds
in the voluntary market, as approved by the Commissioner.
Section 20
Public Education
The Association, on behalf of all Insurers shall undertake a continuing public
education program, in cooperation with the Producers, to assure that this Program
receives adequate public attention.
Section 21
Termination of the Program
This Program shall not be terminated without a two-thirds vote of the majority of
the entire membership and the written consent of the Commissioner, and only after repeal
of R.I. Gen. Laws § 27-33-1 et seq. by the Rhode Island General Assembly. Any
obligations insured by the Association shall not be impaired by the expiration of this
Program and the Association shall be continued for the purpose of performing its
obligations to administer this Program. Any vote to terminate this Program shall specify
an effective date on which the Association shall cease writing policies, but the
Association shall continue in existence for as long as the Governing Committee shall
determine necessary in order to settle claims, carry out its obligations to policyholders
and wind up its affairs. The termination of the existence of the Association shall not
relieve the Members of their obligations to the Association or among themselves, but
such obligations shall continue until the affairs of the Association are finally wound up
and all funds are distributed and assessments paid.
Section 22
Severability
If any provision of this Regulation or the application thereof to any person or
circumstances is held invalid or unconstitutional, the invalidity or unconstitutionality
shall not affect other provisions or applications of this Regulation which can be given
effect without the invalid or unconstitutional provision or application, and to this end the
provisions of this Regulation are severable.
Section 23
Effective Date
This Regulation became effective on October 29, 1968 and the effective date of
all amendments to this Regulation are as set forth below.
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EFFECTIVE DATE:
October 29, 1968
AMENDED:
October 15, 1970
July14, 1971
September 1, 1972
October 1, 1973
September 23, 1975
May 11, 1979
August 14, 1980
March 5, 1981
October 25, 1977
November 8, 1982
REFILED:
January 2, 2002
AMENDED:
July 1, 2004