IBHS Rating the States Report (Members Only)
IBHS “Rating the States” Building Code Report
Questions and Answers
The following IBHS staff provided responses to questions posed by IBHS member company representatives during the webinar conducted Feb. 8, 2012:
Debra Ballen, General Counsel And Senior Vice President, Public Policy
Wanda Edwards, Director Of Code Development
Hank Pogorzelski, Applied Statistician
Were there any surprises that were discovered during the process of producing this report?
Answer: IBHS thinks it is a bit surprising that the Gulf States in general didn’t score better in the report. They are particularly vulnerable to strong hurricanes. We would certainly like to see all of those states, Texas, Mississippi, Alabama and Louisiana, well prepared in terms of building codes.
What kind of reactions have you received from state insurance commissioners?
Answer: All in all, IBHS has gotten a positive reception from the NAIC. Insurance commissioners in all 18 states were provided an advance copy of the report before it was released publicly to avoid surprises, and the reaction was generally positive. Overall the report was seen as a tool for helping to improve mitigation. We have been invited to present the report to the NAIC Property Casualty Committee at their national meeting this spring in New Orleans. This gives IBHS an opportunity to strengthen our relationship with the state insurance commissioners, which we believe is equally as important as delivering the report. We will also be doing a separate presentation with more general information about IBHS and our research at this same upcoming NAIC meeting.
Will the PowerPoint be made available so attendees can share it within their companies?
Answer: Yes, a PDF of the slide presentation is available for download at the top of this page.
The scores in the report make it sound like writing insurance in Florida and Virginia is a great thing. However, many carriers are not writing business in these areas due to lack of code enforcement. How do your numbers relate by county or in coastal areas in these two states?
Answer: IBHS is not able to answer that question, as it pertains to what individual insurance company business decisions in terms of their underwriting in any of these states. We can comment on mitigation in these states. For this report, we only looked at the enforcement issue to see if there was a statute requiring mandatory enforcement at the state level. We didn’t have the ability to investigate local jurisdictions. For that, we would refer you to BCEGS [Building Code Effectiveness Grading Scale], which is a source of information about county specific data developed by ISO.
Have the Texas Department of Insurance or other Texas state agencies shown any interest in this scoring of Texas?
Answer: Texas was one of two states, the other being Mississippi, which posted something on their insurance department websites questioning whether a statewide code was needed. Texas Insurance Commissioner Eleanor Kitzman is from South Carolina and is a strong proponent of mitigation, so we are hoping that we can work with her and her department in terms of strengthening mitigation in Texas. IBHS has talked with local emergency managers in Texas, and they really share our frustrations with respect to the lack of a statewide code. The focus of this report was hurricane risk, although it does obviously go beyond hurricanes in terms of other code provisions that were examined. All of you who are familiar with property protection in Texas know there are many other risks beyond coastal areas and beyond hurricanes, so this state certainly is a top priority for IBHS.
Did you track these 47 data points at any individual JHA’s (jurisdictions having authority)?
Answer: This report was done at the statewide level, not at the individual municipality or county level.
Can you provide average costs to comply with each code by state for the restoration and rebuilding processes to account for them and the pre-loss coverage establishment process?
Answer: That is a work-in-progress for IBHS and a priority for 2012, but it is too early in the process to provide a deadline for when that information will be made available.
What has the response been from various insurance carriers and how are they using the report?
Answer: IBHS would like to think the high level of participation in this webinar is indicative of a very positive response. We hope member companies are using it operationally as well as in the public policy arena. However, that is a decision for each individual company to make.
Wouldn’t statewide building code requirements be more important in small states compared to large ones? Some large states have big inland regions with much lower hazards so it makes sense for them to have less stringent design requirements.
Answer: The code contemplates that wind speeds in areas further from the ocean would be lower than wind speeds experienced in areas on or very close to the ocean. It would stand to reason that there would not be any differences due to the landmass of a state; however, population certainly influences the importance of a small state’s hazard potential.
What impact has the testing facility in South Carolina had on that state’s rating?
Answer: The South Carolina Department of Insurance has had a successful mitigation program in place for some time. The department is to be commended for the work that its mitigation grant program has helped to facilitate. IBHS has gotten a lot of interest from the state in terms of our presence there. Results of work at the IBHS Research Center is finding its way into code proposals we are bringing forth to the S.C. Building Code Council and the International Code Council.
How should we interpret the score? If two states are 50 and 10, respectively, does that mean that one state is five times better than the other.
Answer: IBHS recommends looking at the individual questions and seeing how states scored. Use this as a road map to see the state’s strengths and weaknesses. Incidentally by looking at those scores, you can also get an idea of what IBHS sees as important in these codes and enforcement.
So the new codes primarily apply to new construction, not existing buildings?
Answer: While the code generally applies to new construction, it also applies to any sort of substantial alteration or significant repair or restoration to the property.
Is there any information about when the individual states adopted the codes that were considered for the review?
Answer: Yes, we did look at the edition of the code being evaluated. The more recent the code, the more points the state received. This was important for the hurricane-prone states because there were a number of wind provisions that were added in the last few code cycles, particularly for roof coverings that would have a significant impact on the amount of damage. This part of the analysis is available in Appendix C of the report.
What positive/negative effects could this have in areas where insurance companies are not writing?
Answer: This is a report about mitigation and is not intended to be a report about what insurance companies are doing in individual markets.
Did the codes generally include commercial or residential buildings like condos or apartments?
Answer: The International Residential Code, which is the code referenced in this report, applies to one- and two-family dwellings and townhomes. Condominiums and multi-family residences would be covered under the International Building Code, and therefore were not included in this report.
Were any of the 47 data points based on existing building code requirements, such as re-roofing requirements?
Answer: No, if a state requires a permit for re-roofing then there would be an inspection to make sure it is installed to current code. We didn’t really look at that. Instead, we focused on whether or not contractors were required to be licensed.
Are there any future plans to expand this report to grade states based on local codes, for example larger states, such as Virginia and Texas?
Answer: Not at this time.
Why does Mississippi rate so low when they have recently had some very specific laws passed for wind resistant issues?
Answer: Mississippi doesn’t have a statewide code and they don’t have provisions for state building code officials in terms of their training and certification and they don’t really require much licensing of contractors or sub-contractors. The importance of a statewide code is really the focus of this report. While we certainly are glad when we see that a coastal county has improved its code provisions, we continue to believe that a statewide regime provides important protection benefits.
How much did the BCEGS information influence the score in the category it was considered in?
Answer: Most of the information that came from BCEGS occurred in the category about code officials. We used that information to search regulations and determine exactly what was required. In general, it was the 25 points that were attributed to code official certification.
With all the questions about insurance, is it safe to assume that the codes will have minimal impact now but have a more significant impact 15 – 20 years in the future?
Answer: That is not really a question we would answer with respect to insurance. We can speak to how it will impact the built environment, and we can look at post-Hurricane Katrina as an example. It was after that catastrophe when Louisiana finally adopted a statewide code. If we had looked at Louisiana before Katrina, the state probably would have scored closer to Mississippi in this report. There is a lot of rebuilding following a catastrophe, and particularly in the affected areas, you can have change more quickly and where it is really needed.
Were the states evaluated regarding whether they have adopted one of the existing building code series for retrofitting?
Answer: No, we did not look at the existing building code. This was strictly how they**Answer** adopted the International Residential Building Code.
How many of the coastal states require roofing contractors to be licensed?
Answer: There were only five states out of the 18 evaluated that require roofing contractors to be licensed.
Will the numeric rating remain valid for the state until a change is made in its situation?
Answer: Our current plan is to look at the states in three years because ICC is on a three-year code cycle. If we are aware of a major development, we will re-evaluate and get that information out. We hope there will be positive developments, although there is always the possibly of negative development.
© 2012 Insurance Institute for Business & Home Safety