54th legislature - STATE OF NEW MEXICO - first session, 2019

RELATING TO INSURANCE; PROHIBITING AN INSURER FROM INCREASING THE PREMIUM FOR RESIDENTIAL PROPERTY INSURANCE WITHOUT NOTICE; PROVIDING FOR APPEAL OF A PREMIUM INCREASE; PROVIDING FOR REIMBURSEMENT OF AN INSURANCE PREMIUM.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

SECTION 1. A new section of Chapter 59A, Article 18 NMSA 1978 is enacted to read:

"[NEW MATERIAL] NOTICE.--

A. An insurer who issues residential property insurance policies in this state shall not increase the premium on a residential property insurance policy based upon a change in a public protection classification, community grading, building code effectiveness classification or fire suppression rating schedule unless the insurer provides the policyholder written notice of the proposed increase and the basis for the proposed increase at least one hundred twenty days before the effective date of the increase. The notice shall be mailed to the insured unless the insured has agreed to an alternative method of delivery.

B. A policyholder who receives a notice required under Subsection A of this section may within one hundred twenty days following the date of the notice submit to the insurer a written response informing the insurer that the stated reason for the proposed premium increase is not supported by the empirical evidence.

C. If the insurer proceeds with the premium increase, the policyholder may request a hearing pursuant to Section 59A-4-15 NMSA 1978. If the superintendent finds that the stated reason for the premium increase is not supported by empirical evidence as of the effective date of the premium increase, the superintendent shall order the insurer to refund any increased premium amount to the policyholder and to any other policyholder similarly situated."