,,ii #aaith ,,congress #ast ,session ,s4 #bcdi ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,july #ag1 #bjbe,mr4 ,schiff 7for himself and ,ms4 ,hirono7 introduced the following bill2 which was read twice and referred to the ,committee on ,banking1 ,housing1 and ,urban ,affairs ,a ,,bill ,to require the ,secretary of the ,treasury to establish a catastrophic property loss reinsurance program1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,incorporating ,national ,support for ,unprecedented ,risks and ,emergencies ,act or the ,,insure ,act4 #b4 ,definitions ,in this ,act3 7#a7 ,all-perils property insurance policy ,the term all-perils property insurance policy means a property insurance policy approved by a ,state which includes coverage for catastrophe perils as those perils are added to the ,program4 7#b7 ,catastrophe peril ,the term catastrophe peril means the damage caused by-- 7,a7 wind1 hurricane1 wildfire1 severe convective storm1 and flood as they are added to the ,program under section #c7;d72 7,b7 earthquake1 conditioned on the report under section #d7b72 and 7,c7 any other peril as determined by the ,secretary and added to the ,program4 7#c7 ,engaged in the business of insurance ,the term engaged in the business of insurance means a person or entity that is subject to oversight by a ,state insurance department4 7#d7 ,fund ,the term ,fund means the ,federal ,catastrophe ,reinsurance ,fund established under section #c7;i74 7#e7 ,insurer ,the term insurer-- 7,a7 means an admitted or non-admitted insurance company licensed or authorized to sell primary property insurance by ,state insurance regulators2 and 7,b7 does not include a reinsurance company or a captive insurance company4 7#f7 ,participating insurer ,the term participating insurer means an insurer that is participating in the ,program4 7#g7 ,program ,the term ,program means the catastrophic property loss reinsurance program established under section #c7;a74 7#h7 ,property insurance policy ,the term property insurance policy means a contract of insurance1 through a policy form approved by a ,state insurance department1 that provides1 among other coverages1 coverage for physical damage to residential or commercial property4 7#i7 ,secretary ,the term ,secretary means the ,secretary of the ,treasury4 7#aj7 ,statistical plan ,the term statistical plan means-- 7,a7 a description of the data elements to be reported2 and 7,b7 the instructions and procedures for accurately reporting data4 #c4 ,catastrophic property loss reinsurance program 7a7 ,in general ,not later than #d years after the date of enactment of this ,act1 the ,secretary shall establish a catastrophic property loss reinsurance program to provide reinsurance for qualifying primary insurance companies4 7b7 ,eligibility ,an insurer is qualified to participate in the ,program if such insurer-- 7#a7 offers an all-perils property insurance policy1 as perils are phased in under subsection 7d71 for-- 7,a7 residential property insurance policies2 or 7,b7 commercial property insurance policies2 and 7#b7 offers a loss prevention partnership with the policyholder to encourage investments and activities that reduce insured and economic losses from a catastrophe peril4 7c7 ,consultation ,the ,secretary may contract with reinsurance brokers and consultants to assist the ,secretary in the design and management of the ,program4 7d7 ,program phase-,in timeline ,the ,secretary shall-- 7#a7 not later than ,january #a of the year beginning #d years after the date of enactment of this ,act1 operate the ,program for the perils of wind and hurricane2 7#b7 not later than ,january #a of the year beginning #e years after the date of enactment of this ,act1 operate the ,program for the perils of severe convective storm and wildfire2 7#c7 not later than ,january #a of the year beginning #f years after the date of enactment of this ,act1 operate the ,program for the peril of flood2 and 7#d7 not later than the earlier of ,january #a of the year beginning #h years after the date of enactment of this ,act or the date on which the feasibility report described in section #d7b7 is submitted1 operate the ,program for the peril of earthquake4 7e7 ,threshold for payment 7#a7 ,in general ,the ,secretary shall1 after consulting with the advisory committee established under subsection 7h71 establish a financial threshold at which a participating insurer may receive amounts from the fund established under subsection 7i74 7#b7 ,threshold calculation ,the threshold established under paragraph 7#a7 shall be an amount that is not greater than #dj percent of the probable maximum loss of an individual participating insurer for each catastrophe peril included in the ,program4 7#c7 ,considerations ,in establishing the threshold described in paragraph 7#a71 the ,secretary shall consider-- 7,a7 the amount of reinsurance necessary to meaningfully reduce the cost to the participating insurer to-- 7i7 provide coverage for catastrophe perils covered by the ,program2 and 7ii7 encourage ,states to require participating insurers to offer an all-perils property insurance policy2 7,b7 the levels of primary insurer retention and private reinsurance market capacity necessary to-- 7i7 promote stable and competitive markets for catastrophe reinsurance2 and 7ii7 incentivize the establishment by private parties of capital market alternatives to reinsurance1 for example the creation of a market for catastrophe bonds2 and 7,c7 the role of the ,program in promoting investments by participating insurers that would be aimed at decreasing losses4 7f7 ,premiums 7#a7 ,in general ,the ,secretary shall require participating insurers to pay a premium to the ,secretary each quarter4 7#b7 ,premium amount considerations ,the amount of the premium required under paragraph 7#a7 shall reflect only the following considerations3 7,a7 ,the expected average annual losses for the participating insurer under the specific terms of the reinsurance coverage1 as calculated by the ,secretary based on the exposure of the participating insurer4 7,b7 ,the administrative costs to administer and manage the ,program4 7,c7 ,a trend factor to account for increases over time in the cost of average annual losses for participating insurers1 as determined by the ,secretary4 7#c7 ,consultation ,the ,secretary shall consult with the advisory committee established under subsection 7i7 when establishing premium amounts and may contract for services to assist in the establishment of premium amounts4 7#d7 ,minimum premium required ,the ,secretary may not establish any premium that is less than #ej percent of the amount equal to the sum of the-- 7,a7 expected average annual losses for the participating insurer1 as calculated by the ,secretary based on the exposure of the participating insurer2 and 7,b7 administrative costs to administer and manage the ,program4 7#e7 ,premium adjustments ,the ,secretary shall adjust premiums each quarter for each participating insurer to reflect material changes in the exposure of the participating insurer4 7#f7 ,premium increases ,excluding any adjustment made under paragraph 7#e71 the ,secretary may increase premiums for a participating insurer not more than #g percent annually4 7g7 ,loss prevention partnerships 7#a7 ,in general ,the ,secretary1 in coordination with the advisory committee established under subsection 7h71 ,state insurance agencies1 and ,state and ,federal emergency management agencies1 shall develop a list of activities that qualify as loss prevention partnerships for purposes of this section1 which may include the following activities3 7,a7 ,participating insurers identifying loss prevention steps that make properties eligible for coverage or renewal4 7,b7 ,participating insurers making coverage contingent upon the implementation of a loss prevention activity by a potential insured party4 7#b7 ,activities excluded from loss prevention partnerships ,the ,secretary1 ,state insurance agencies1 and ,state and ,federal emergency management agencies may not include the following activities as loss prevention partnerships for purposes of this section3 7,a7 ,the provision of an insurance premium discount for an investment by an insured party or potential insured party in an activity designed to reduce the losses of the participating insurer1 absent an investment by the participating insurer4 7,b7 ,the provision of general information about loss prevention4 7h7 ,advisory committee 7#a7 ,in general ,the ,secretary shall establish an advisory committee to advise the ,secretary with respect to the ,program4 7#b7 ,membership ,the committee established under paragraph 7#a7 shall include the following members3 7,a7 #e members representing consumer organizations engaged in fair housing1 insurance1 environmental1 climate1 and technology advocacy4 7,b7 #c members selected from individual primary insurance companies selling property insurance policies1 including one large national insurer1 #a medium sized regional insurer1 and #a small insurer4 7,c7 #a global reinsurer active in ,united ,states property insurance markets4 7,d7 #a domestic-focused reinsurer active in ,united ,states property insurance markets4 7,e7 #b insurance regulators from a ,state of the ,united ,states1 a territory or possession of the ,united ,states1 or the ,district of ,colombia4 7,f7 #b ,state legislators who-- 7i7 serve on ,state legislative committees with oversight over insurance matters2 and 7ii7 are not employed directly or indirectly by any person or organization engaged in the business of insurance4 7,g7 #b members selected from independent insurance agents who serve traditionally underserved areas4 7,h7 #a representative from a mortgage lender4 7,i7 #a representative from a bank4 7,j7 #a representative from each of the following agencies3 7i7 ,the ,department of ,housing and ,urban ,development4 7ii7 ,the ,department of ,health and ,human ,services4 7iii7 ,the ,federal ,housing ,finance ,agency4 7iv7 ,the ,department of ,veterans ,affairs4 7v7 ,the ,department of ,agriculture4 7vi7 ,the ,federal ,emergency ,management ,agency4 7vii7 ,the ,office of ,management and ,budget4 7viii7 ,the ,environmental ,protection ,agency4 7,k7 #a representative from the ,financial ,stability ,oversight ,council4 7i7 ,federal ,catastrophe ,reinsurance ,fund 7#a7 ,in general ,the ,secretary shall establish the ,federal ,catastrophe ,reinsurance ,fund to hold and invest premiums paid by participating insurers4 7#b7 ,issuance of notes and bonds 7,a7 ,in general ,if amounts in the ,fund are insufficient to pay obligations to participating insurers1 the ,secretary shall issue notes and bonds under this paragraph1 the proceeds of which shall be used for payment obligations to participating insurers4 7,b7 ,terms ,notes and bonds issued under this paragraph shall be-- 7i7 in such form and denominations1 and shall be subject to such terms and conditions of issue1 conversion1 redemption1 maturation1 and payment as the ,secretary may prescribe2 and 7ii7 fully and unconditionally guaranteed both as to interest and principal by the ,united ,states1 and that guaranty shall be expressed on the face of each bond4 7,c7 ,interest ,notes and bonds issued under this paragraph shall bear interest at a rate not less than the current average yield on outstanding market obligations of the ,united ,states of comparable maturity during the month preceding the issuance of the obligation as determined by the ,secretary4 7,d7 ,treatment ,all notes and bonds issued under this paragraph1 and the interest on credits with respect to those obligations1 shall not be subject to taxation by any ,state1 county1 municipality1 or local taxing authority4 7,e7 ,satisfaction ,the ,secretary shall utilize investment revenue from the ,fund to satisfy any notes or bonds issued under this paragraph4 7j7 ,data collection 7#a7 ,in general ,the ,secretary shall-- 7,a7 establish a statistical plan for quarterly reporting by participating insurers of policy-level claim transaction data2 7,b7 consult with the advisory committee established under subsection 7h7 and the ,national ,association of ,insurance ,commissioners with respect to-- 7i7 the contents of the statistical plan2 and 7ii7 the method of data collection2 7,c7 collect quarterly reports from each participating insurer that include-- 7i7 a description of all exposures covered by the ,program at the time of the submission of the report2 and 7ii7 a list of the type and amount of all claims made in the previous quarter2 7,d7 in a manner that does not risk public disclosure of personally identifiable information of policyholders1 provide the quarterly reports received under subparagraph 7,c7 to-- 7i7 the ,director of the ,office of ,financial ,research to assess risk to-- 7,i7 the financial stability of the ,united ,states2 and 7,,ii7 international financial systems arising from ,united ,states property insurance markets1 including lack of available property insurance or inadequate coverage from property insurance2 7ii7 the ,director of the ,federal ,insurance ,office to assess the risks to the financial stability arising from under-insurance of property insurance policies covering catastrophe perils1 including in traditionally underserved insurance markets2 7iii7 the head of the department of insurance in each ,state2 and 7iv7 any other ,federal1 ,state1 or local government entity that1 as determined by the ,secretary1 is related to-- 7,i7 catastrophe loss prevention1 mitigation1 or recovery2 or 7,,ii7 the promotion of competitive property insurance markets2 and 7,e7 make the data collected under this paragraph available online in a manner that does not risk public disclosure of personally identifiable information of policyholders4 7#b7 ,contracting with a statistical agent 7,a7 ,in general ,the ,secretary shall contract with a statistical agent via a competitive bidding process to collect and review the data under this subsection for accuracy and completeness4 7,b7 ,office of ,financial ,research as the statistical agent ,if the ,secretary is unable to identify a qualified statistical agent for collection of data under this subsection1 the ,director of the ,office of ,financial ,research shall establish a data collection infrastructure for collection of such data4 #d4 ,reports on relocation fund and earthquake coverage ,the ,secretary shall-- 7#a7 not later than #b years after the date of enactment of this ,act1 submit to ,congress a report on the feasibility of establishing a fund to relocate homes and businesses that have become uninsurable due to catastrophe perils2 and 7#b7 not later than #c years after the date of enactment of this ,act1 submit to ,congress a report on the feasibility of including earthquakes as a peril covered under the all-perils property insurance policy4 #e4 ,long-term policy pilot program 7a7 ,in general ,the ,secretary shall1 in consultation with ,states and the ,national ,association of ,insurance ,commissioners1 establish a pilot program for all-perils property insurance policies1 as perils are phased in under section #c7;d71 with a policy term of at least #e years 7in this section referred to as a multi-year policy74 7b7 ,premium and policy conditions ,an insurer who participates in the pilot program established under this section may-- 7#a7 increase premiums based on-- 7,a7 price indexes of construction costs2 7,b7 changes in home value2 and 7,c7 optional coverages selected by the policyholder2 7#b7 not increase premiums based on a change in the assessment by the insurer of the catastrophe peril risks associated with the insured property2 7#c7 require property maintenance consistent with the condition of the property at time of initial policy issuance2 and 7#d7 require loss mitigation investment partnerships as a condition for the multi-year policy4 7c7 ,actions by the policyholder 7#a7 ,policy continuation ,with the agreement of the insurer1 a consumer purchasing the property during the term of the multi-year policy may continue the policy for the remainder of the term4 7#b7 ,election to new insurer ,if the policyholder elects to move to a new insurer during the term of the multi-year policy1 the new insurer may take into account loss mitigation investment partnerships with the prior insurers in rate setting4 7#c7 ,cancellation by policyholder ,if the policyholder is the recipient of any funds for loss prevention property improvements from the insurer1 ,federal1 ,state1 local government1 or other source and the policyholder cancels the policy before the end of the multi-year policy term1 the policyholder shall return a pro-rata share of such improvement to the source of the funds4