Last May, President Barack Obama signed HR 5740, which phases out subsidized premium rates for certain properties coded as non-principal/non-primary residences. A non-principal/non-primary residence is defined as a building that will not be lived in by the insured or insured’s spouse for at least 80-percent of the 365 days following the policy effective date.
In order to satisfy the requirements of this bill, Pre-Firm single-family, 2-4 family and other residential occupancies insured as unit owner properties currently coded as non-primary residence homes in Selective’s system will receive 25-percent rate increase each year beginning in January 1, 2013 until the average risk premium rate for such properties is equal to the average risk premium rates for actuarially-rated properties.
Per National Flood Insurance Program (NFIP) requirements, Selective Insurance Group will be sending out the attaached NFIP non-principal/non-primary residence policyholder notice on all dwelling policies beginning March 1, 2013 to provide customers the opportunity to correct the policy rating if necessary from non-primary to primary.
As indicated in the letter, customers can either contact you, their agent to request the change or they can sign and submit the letter to Selective directly for processing. If the customer contacts you directly, you will need to submit the request as you would any other premium impacting endorsement.
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If you should have any further questions on this change, please contact Gunn Mowery at 1-800-840-1243, or email us at email@example.com.
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