Bill Sponsors
Azzinaro, Kennedy, Lima, and O'Brien
Committee
House Corporations
Summary
Select
This legislation amends Rhode Island's casualty insurance laws to provide greater protections for homeowners. Specifically, starting September 1, 2026, insurance companies will be required to provide at least two months' written notice to policyholders if their homeowners insurance renewal premium will increase by more than 20 percent. Furthermore, if an insurer intends to issue a non-renewal (canceling the policy at the end of the term), they must also provide notice at least two months in advance. Violations of these notice requirements constitute a deceptive trade practice and are punishable by a fine of up to $1,000 per violation.
Sponsor
Analysis
Pros for Progressives
- Protects consumers and homeowners from predatory practices by ensuring they have adequate time to find alternative coverage or budget for significant cost increases.
- Holds large insurance corporations accountable by defining violations of notice requirements as deceptive trade practices subject to financial penalties.
- Promotes housing stability by preventing abrupt cancellations that could jeopardize mortgages and leave vulnerable populations without essential property protection.
Cons for Progressives
- The effective date for the new protections is delayed until September 1, 2026, leaving consumers vulnerable to sudden hikes and cancellations for several years.
- The twenty percent threshold for mandatory notice is relatively high, meaning homeowners could still face substantial financial burdens without the benefit of early warning.
- The maximum fine of one thousand dollars may be insufficient to deter large, profitable insurance companies from ignoring the law when it suits their bottom line.
Pros for Conservatives
- Provides property owners with necessary market information and predictability, allowing them to better manage their personal assets and financial planning.
- Encourages a more transparent marketplace where consumers can shop for competitive rates rather than being trapped by last-minute price changes.
- Focuses on procedural fairness regarding notice rather than imposing direct government price controls or caps on what businesses can charge.
Cons for Conservatives
- Increases government regulation on private businesses by dictating the specific terms and timelines of service contracts between insurers and clients.
- Imposes potential fines and legal liabilities on businesses for administrative timing issues, characterizing them as deceptive trade practices.
- Creates additional compliance burdens for insurance companies, which may result in increased administrative costs passed down to the consumer.
Constitutional Concerns
None Likely
Impact Overview
Groups Affected
- Homeowners
- Insurance Companies
- Insurance Agents
- Mortgage Lenders
- Property Investors
Towns Affected
All
Cost to Taxpayers
None
Revenue Generated
$1,000/fine
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Bill Status
Current Status
Held
Comm Passed
Floor Passed
Law
History
• 01/14/2026 Introduced, referred to House Corporations
Bill Text
SECTION 1. Section 27-8-11 of the General Laws in Chapter 27-8 entitled "Casualty Insurance Generally" is hereby amended to read as follows:
27-8-11. Regulations on cancellation and renewal.
(a) In addition to, and not in lieu of, any other power the commissioner has to issue rules and regulations, the commissioner of insurance may promulgate, in accordance with the procedure established in chapter 35 of title 42, reasonable rules and regulations concerning cancellation and renewal of liability and property damage insurance for automobiles rated as private passenger automobiles, homeowners insurance, residential fire insurance, or any components thereof. Those regulations may require that the insurer shall furnish to the named insured the reason, or reasons, for cancellation or nonrenewal. Those regulations shall also require that the insurer furnish, at least thirty (30) days prior to renewal, written notice of any coverage reductions, elimination, or increased deductibles not made at the request of the insured. The notice shall itemize and describe the policy coverage reductions, elimination, or increased deductibles and shall be captioned “NOTICE OF REDUCTION IN COVERAGE”. The policyholder shall be notified that the policy renewal contains the “NOTICE OF REDUCTION IN COVERAGE” by one of the following manners:
(1) By mailing the “NOTICE OF REDUCTION IN COVERAGE” separate from the renewal policy package mailing; or
(2) By printing “NOTICE OF REDUCTION IN COVERAGE ENCLOSED” on the renewal policy package envelope and including said reductions in the first few pages of the renewal policy package; or
(3) By printing “NOTICE OF REDUCTION IN COVERAGE ENCLOSED” on the first page of the renewal policy package; or
(4) If the renewal policy package is made available by email, the email notifying the policyholder of the renewal shall contain a statement that the policy contains a “NOTICE OF REDUCTION IN COVERAGE” and said reductions shall be in the first few pages of the renewal policy package.
These coverage changes must be approved by the insurance division with respect to those types of insurance defined in § 27-8-1(1) — (8), issued to non-business insureds and bodily injury and property damage liability coverage issued to non-business insureds. There shall be no liability on the part of, and no cause of action of any nature shall arise against, the commissioner of insurance or any insurer, their authorized representatives, agents, or employees, or any firm, person, or corporation furnishing to the insurer or commissioner information as to the reasons for cancellation or nonrenewal; for any statement made by any of them in any written notice of cancellation or nonrenewal; or in any other communication, oral or written, specifying the reasons for cancellation or nonrenewal; or for the providing of information pertaining to the cancellation or nonrenewal; or for statements made, or evidence submitted, at any hearing conducted in connection with the cancellation or nonrenewal.
(b) The commissioner shall promulgate regulations with respect to personal motor vehicle insurance, homeowners insurance, and residential fire insurance, or any components of that insurance requiring notification to policyholders upon renewal of any coverage reductions, elimination, or increased deductibles not at the request of the insured.
(c) Notwithstanding any law to the contrary, on and after September 1, 2026, any increase of more than twenty percent (20%) in the cost of renewal of homeowner’s insurance shall require two (2) months’ advance notice be provided by the insurer to the policyholder. If an insurer is failing to renew a homeowner’s policy, the notice of non-renewal shall be delivered to the policyholder no less than two (2) months in advance of the policy expiration.
(d) Any violation of the provisions of this section shall constitute a deceptive trade practice in violation of chapter 13.1 of title 6, and each violation shall be punishable by a fine not to exceed one thousand dollars ($1,000). LC004096 - Page 2 of 4
SECTION 2. This act shall take effect upon passage.
27-8-11. Regulations on cancellation and renewal.
(a) In addition to, and not in lieu of, any other power the commissioner has to issue rules and regulations, the commissioner of insurance may promulgate, in accordance with the procedure established in chapter 35 of title 42, reasonable rules and regulations concerning cancellation and renewal of liability and property damage insurance for automobiles rated as private passenger automobiles, homeowners insurance, residential fire insurance, or any components thereof. Those regulations may require that the insurer shall furnish to the named insured the reason, or reasons, for cancellation or nonrenewal. Those regulations shall also require that the insurer furnish, at least thirty (30) days prior to renewal, written notice of any coverage reductions, elimination, or increased deductibles not made at the request of the insured. The notice shall itemize and describe the policy coverage reductions, elimination, or increased deductibles and shall be captioned “NOTICE OF REDUCTION IN COVERAGE”. The policyholder shall be notified that the policy renewal contains the “NOTICE OF REDUCTION IN COVERAGE” by one of the following manners:
(1) By mailing the “NOTICE OF REDUCTION IN COVERAGE” separate from the renewal policy package mailing; or
(2) By printing “NOTICE OF REDUCTION IN COVERAGE ENCLOSED” on the renewal policy package envelope and including said reductions in the first few pages of the renewal policy package; or
(3) By printing “NOTICE OF REDUCTION IN COVERAGE ENCLOSED” on the first page of the renewal policy package; or
(4) If the renewal policy package is made available by email, the email notifying the policyholder of the renewal shall contain a statement that the policy contains a “NOTICE OF REDUCTION IN COVERAGE” and said reductions shall be in the first few pages of the renewal policy package.
These coverage changes must be approved by the insurance division with respect to those types of insurance defined in § 27-8-1(1) — (8), issued to non-business insureds and bodily injury and property damage liability coverage issued to non-business insureds. There shall be no liability on the part of, and no cause of action of any nature shall arise against, the commissioner of insurance or any insurer, their authorized representatives, agents, or employees, or any firm, person, or corporation furnishing to the insurer or commissioner information as to the reasons for cancellation or nonrenewal; for any statement made by any of them in any written notice of cancellation or nonrenewal; or in any other communication, oral or written, specifying the reasons for cancellation or nonrenewal; or for the providing of information pertaining to the cancellation or nonrenewal; or for statements made, or evidence submitted, at any hearing conducted in connection with the cancellation or nonrenewal.
(b) The commissioner shall promulgate regulations with respect to personal motor vehicle insurance, homeowners insurance, and residential fire insurance, or any components of that insurance requiring notification to policyholders upon renewal of any coverage reductions, elimination, or increased deductibles not at the request of the insured.
(c) Notwithstanding any law to the contrary, on and after September 1, 2026, any increase of more than twenty percent (20%) in the cost of renewal of homeowner’s insurance shall require two (2) months’ advance notice be provided by the insurer to the policyholder. If an insurer is failing to renew a homeowner’s policy, the notice of non-renewal shall be delivered to the policyholder no less than two (2) months in advance of the policy expiration.
(d) Any violation of the provisions of this section shall constitute a deceptive trade practice in violation of chapter 13.1 of title 6, and each violation shall be punishable by a fine not to exceed one thousand dollars ($1,000). LC004096 - Page 2 of 4
SECTION 2. This act shall take effect upon passage.