Requires insurers who underwrite property and casualty policies in the state to cover costs associated with bedbug infestations

BILL NUMBER:S4926A

Title of bill

An act to amend the insurance law, in relation to requiring insurers who underwrite property and casualty policies in the state to cover costs associated with bedbug infestations in residential buildings

Purpose or general idea of bill

The purpose of this bill is to require property/casualty insurers that underwrite residential property damage coverages to offer an optional bedbug insurance coverage damage rider for New Yorkers that wish to purchase such a bedbug rider. This bill will allow those who experience a financial loss as a result of a bedbug infestation in their residence to be covered for those losses incurred due to such infestation. This policy rider option must be made available to homeowners, renters, condominium and co-op unit owners.

Summary of specific provisions

Section 1: Amends Insurance Law section 3407-a to require that all property/casualty insurers provide consumers with an option to purchase a insurance contract rider that covers losses due to a home bedbug infestation. Under this rider, coverage will include compensation for costs related to: a) extermination services, b) cleaning of the dwelling to rid the place of bedbugs and bedbug waste products, c) cleaning an insured's personal property located at the insured premises such as dry cleaning of clothing and bedding, and d) the replacement of items which are not able to be treated or cleaned, including, but not limited to mattresses or furniture.

Justification

Nearly every day, another report surfaces about a bedbug infestation in New York City. In fact, a recent survey conducted by the pest control company Terminix found that Manhattan ranked number one in the list of the top 15 most bedbug infested cities. Besides homes, bedbugs have also been found in upscale department stores, movie theaters, hospitals, and the Brooklyn District Attorney's Office.

Individuals report spending great sums of money to treat, clean and replace infested items, usually totaling in the thousands of dollars. The psychological, physical and financial toll of enduring a bedbug infestation is well documented. By offering an optional insurance contract rider against the damage caused by bedbugs, residents will be given the opportunity to protect themselves in the event of an infesta- tion. The need for bedbug insurance should be viewed no differently than those types of insurance which cover losses from other fortuitous events such as theft, water damage, fire, or other types of damage.

This bill has been amended once for technical reasons and to include a requirement that the exterminator be licensed and sets a limit to the amount an insured can recover at five thousand dollars for residences under two thousand square feet and ten thousand for those over.

Prior legislative history

New Bill.

Fiscal implications

None.

Effective date

This law shall take effect on the 180th day after it shall have become law.