Section 27-31D-1
Premium discount or insurance rate reduction - Construction and certification.
(a) Commencing on May 14, 2009, insurance companies shall provide a premium discount or insurance rate reduction in an amount and manner as established in subsection (j) and pursuant to Section 27-31D-3. In addition, insurance companies may also offer additional adjustments in deductible, other credit rate differentials, or a combination thereof, collectively referred to as adjustments. These adjustments shall be available under the terms specified in this section to any owner who builds or locates a new insurable property, in the State of Alabama, to resist loss due to hurricane or other catastrophic windstorm events.
(b) To obtain the adjustment provided in this section, an insurable property located in this state shall be certified as constructed in accordance with either of the following:
(1) The 2006 International Residential Code, as amended, including all hurricane mitigation construction requirements.
(2) The Fortified For Safe Living Standards (FFSLS), as may from time to time be adopted by the Institute for Business and Home Safety (IBHS), or a successor entity, or the Fortified Commercial Standard (FCS), as, from time to time, may be adopted by IBHS.
(c) An insurable property shall be certified as conforming to the applicable building code only after an inspection of the insurable property has been satisfactorily completed by a certified or licensed building inspector and certified to be conforming to the applicable building code including all hurricane or high wind and hail mitigation construction requirements.
(d) An insurable property shall be certified as conforming to FFSLS or FCS criteria only after inspection and certification by an IBHS certified inspector.
(e) An owner of insurable property claiming an adjustment pursuant to subsection (c) and subdivision (1) of subsection (b) shall maintain certification records and construction records including a certification of compliance with the applicable building code provided in subdivision (1) of subsection (b), receipts from contractors, receipts for materials, and records from local building officials.
(f) An owner of insurable property claiming an adjustment pursuant to subsection (d) and subdivision (2) of subsection (b) shall maintain the IBHS certification documentation, which shall be considered proof of compliance with the FFSLS or FCS requirements described in subsection (d) and subdivision (2) of subsection (b).
(g) The records required by this section shall be subject to audit by the Commissioner of Insurance, or his or her representatives.
(h) Evidence of IBHS certification as provided for in subsection (d) and subdivision (2) of subsection (b) shall be presented to the insurer or potential insurer of a property owner before the adjustment becomes effective for the insurable property.
(i) The records required to be maintained by subsection (e) shall be presented to the insurer or potential insurer of a property owner before the adjustment becomes effective for the insurable property.
(j) Insurers required to submit rates and rating plans to the commissioner shall submit an actuarially justified rating plan for any person who builds an insurable property to comply with the sets of requirements of this section. An insurer is not required to provide the same amount of adjustment for a building code insurable property as the insurer would to an FFSLS or FCS insurable property. An adjustment shall only apply to policies that provide wind coverage and may apply to that portion of the premium for wind coverage or to the total premium if the insurer does not separate out its premium for wind coverage in its rate filing. The adjustment shall apply exclusively to the premium designated for the improved insurable property. In addition to the requirements of this section, an insurer may voluntarily offer any other mitigation adjustment that the insurer deems appropriate.
(Act 2009-500, p. 924, §1; Act 2015-313, p. 947, §1; Act 2018-249, §1.)