Missouri Legislators Propose Insurance Change
JEFFERSON CITY - Legislation to provide better home insurance coverage for victims of natural disasters awaits approval in a senate committee.
The proposed bill, sponsored by Republican Senator Ron Richard, would expand the current full payout law to cover anyone whose home is destroyed by anything covered in their policy. Under current law, it only applies to homes destroyed by fire. Full payout language means insurance companies would have to pay for all property and contents lost in a covered disaster. Some policies cover only up to the market value of the structure and inventoried items.
"When you're going through that shock, you really don't know what you had and if you're paying for the coverage though, as my mind to thinking, then you ought to be able to receive what you're paying for, which is that loss. And in a disaster area you should be fully compensated," said Richard.
Opponents of the bill argue more coverage will cause rates to increase for everyone. Insurance groups like Missouri Insurance Coalition testified against the bill last week, saying a blanket coverage fee like the one proposed would provide coverage above the actual value of some individuals belongings.
"In and of itself that causes problems, because not everyone has the same amount and you'll have to pay out more than you really lost. And that causes rates to go up for everybody," said Missouri Insurance Coalition Government Affairs Director Brent Butler.
Committee members said they will vote on the bill this week. If passed, it will move to the senate floor.