The Senate in the state has given its unanimous approval to the clarification of policies.
The New Jersey Senate has just given its approval to assist residents with achieving a better understanding of their homeowner insurance policies, passing a bill by a unanimous 38 to 0 vote.
The bill would make it a requirement for insurers to make their coverage far simpler to understand.
The Senate bill (A-3642) would require that homeowners insurance companies provide their customers with an information brochure – one that is already a requirement under the law in the state – which includes a single page summary of what the policy provides. It must be written in clear language that someone outside the industry will be able to easily understand in a practical way.
The homeowners insurance summary must identify all of the primary covered elements and exclusions.
According to Assemblyman Ruben J. Ramos Jr. (D-Hudson), “This summary must include notable coverage and exclusions under the policy, so that there will be no misunderstandings when consumers need to invoke their policy.” Ramos is one of the bill’s sponsors.
He also explained that after Superstorm Sandy left its damage behind, many property owners were “shocked to learn some things they expected to be covered were not under their policy. It’s time for insurance companies to provide a clearer explanation.”
Back on December 6, 2012, a hearing was held by the Assembly Financial Institutions and Insurance Committee, under the chairperson Assemblyman Gary Schaer. There, a review was held of homeowners insurance issues with which residents were struggling following the massive storm. Among the issues that was brought forward was that many people simply do not know exactly what kind of coverage they have, even when they have been paying for it for many years.
The new homeowners insurance bill is an effort to help to provide those residents with a policy format that offers an easy to understand overview of what is – and what is specifically not – covered by the policy. The hope is that this will help residents to be able to gain a far clearer understanding of what protection they have available to them if disaster should strike.