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IBHS Resource Materials Relating to Alabama Safe Homes Legislation

In 2009, Alabama passed legislation (Alabama Act 2009-500, now codified as Ala. Code §§ 27-31D-1), which requires Alabama-admitted insurance companies to provide a premium discount or insurance rate reduction to owners who build, rebuild, or retrofit certain residential properties in accordance with specified standards to better withstand hurricanes and other catastrophic windstorm events.
 
Eligible properties generally include one- and two-family detached dwellings that have been designated as meeting applicable design and construction requirements of the Institute for Business & Home Safety’s (IBHS) Fortified...for safer living® program (for new construction), Fortified for Existing Homes (for retrofitting), or new construction under the International Code Council’s® 2006 International Residential Code®. There also are provisions applicable to manufactured homes.
 
The premium discounts or rate reductions called for in the Act apply to new insurance policies written or existing policies renewed on and after May 1, 2010. The Department of Insurance (DOI) has issued a Bulletin (2009-07) to implement the law. The Bulletin requires each company affected by the Act either to: 1) file with the DOI an actuarially-justified rating plan recognizing the required premium discounts or rate reductions by January 1, 2010; or 2) use benchmark discounts developed by the DOI (no filing required).
 
IBHS offers no opinion or advice as to the level of appropriate premium discounts or rate reductions to be filed by insurers under the Act. To assist individual insurance companies in making their own filings, however, we have put together a resource kit which includes a technical overview of IBHS’ Fortified for Existing Homes program criteria for retrofitting. Also included in this resource kit are a copy of the Act and the Alabama Department of Insurance Bulletin regarding the implementation of the new statute.