Assembly approves standards to speed insurer response after declared disasters

Sponsor Assemblymember Stern said the bill "establishes claim investigation and timely settlement standards for insurance companies in the event of a natural disaster or other declared emergency," explaining that insurers would have 15 days after a claimant completes the required application to make a determination and could extend once for an additional 15 days if reasonably necessary.

Members pressed for practical clarity. One member asked when the 15-day clock begins; Stern said it begins after the insurer determines the claimant has submitted the list of documentation the insurer requires. Stern noted post-Sandy reforms and emergency regulations that reduced initial response requirements in prior disasters, and said regulators can use rulemaking to address implementation challenges.

The sponsor said failure to comply with the time requirement would trigger a civil penalty of $1,000 per offense after notice and a hearing. Several members, including insurance-industry and rural-district representatives, warned that the 15-day requirement could be impractical in widespread disasters where adjusters and contractors are scarce.

Following debate and member explanations on the floor, the Assembly recorded a roll-call vote and passed the bill.