REPRESENTATIVES J. Stewart, Aslanides, Hollister, Schaffer, Seitz, Skindell, Cirelli, Domenick, Niehaus, Blasdel, Carano, Collier, Daniels, DeBose, C. Evans, D. Evans, Gibbs, Otterman, Slaby, D. Stewart, Wilson, Wolpert

To amend sections 3929.50, 3929.51, 3929.52, 3929.56,

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3929.58, and 3929.59 of the Revised Code to remove

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current limits on mine subsidence coverage, to

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increase the cap on the amount of reinsurance

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coverage that the mine subsidence underwriting

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association may offer, to end the annual

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distribution of excess moneys in the mine

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subsidence insurance fund to policyholders, to

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permit a representative to be elected to the mine

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insurance governing board without a meeting of the

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members, and to specify the Ohio counties in which

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mine subsidence insurance must be offered in

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connection with property and homeowners insurance.

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BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1. That sections 3929.50, 3929.51, 3929.52, 3929.56,	14
3929.58, and 3929.59 of the Revised Code be amended to read as	15
follows:	16

Sec. 3929.50.  As used in sections 3929.50 to 3929.61 of the	17
Revised Code:	18

(A) "Mine subsidence" means loss caused by the collapse or	19
lateral or vertical movement of structures resulting from the	20
caving in of underground mines, including coal mines, clay mines,	21
limestone mines, and salt mines. "Mine subsidence" does not	22
include loss caused by earthquake, landslide, volcanic eruption,	23
or collapse of strip mines, storm and sewer drains, or rapid	24
transit tunnels.	25

(B) "Structure" means any one- to four-family dwellings as	26
defined and limited in standarddwelling fire, homeowners, and	27
farm policies and other structures as described, defined, or	28
limited in the mine subsidence insurance form.	29

(C) "Basic property insurance" means insurance against direct	30
loss to property as defined and limited in standarddwelling fire,	31
homeowners, and farm policies and extended coverage endorsements	32
thereon, as approved by the superintendent of insurance, and	33
insurance for such types, classes, and locations of property	34
against the perils of vandalism, malicious mischief, burglary, or	35
theft, as the superintendent shall designate.	36

(D) "Homeowners insurance" means insurance on owner-occupied	37
dwellings providing personal multi-peril property and liability	38
coverages commonly known as homeowners insurance, and is subject	39
to such reasonable underwriting standards, exclusions,	40
deductibles, rates, and conditions as are customarily used by	41
member insurers for similar coverages.	42

(E) "Mine subsidence coverage" means the limits and type of	43
coverage as defined by the mine subsidence insurance governing	44
board in the coverage form and approved by the superintendent.	45

(F) "Farm insurance" means insurance providing property	46
coverage on farm dwelling buildings.	47

(G) "Dwelling fire insurance" means a policy providing	48
property coverage on residential buildings for the perils of fire	49
and lightning and additional coverages.	50

Sec. 3929.51.  (A) The Ohio mine subsidence insurance	51
underwriting association is hereby created, consisting of all	52
insurers authorized to write and engaged in writing within the	53
state, on a direct basis, basic property insurance or any	54
component thereof in multi-peril policies, to operate in	55
accordance with the plan of operation adopted pursuant to section	56
3929.53 of the Revised Code. Every such insurer shall be a member	57
of the association and shall remain a member as a condition of its	58
authority to write such insurance in this state.	59

(B) The association, pursuant to sections 3929.50 to 3929.61	60
of the Revised Code, and any plan of operation thereunder with	61
respect to mine subsidence insurance, may assume and cede	62
reinsurance on insurable risks written by its members.	63

(C) For the purpose of governing the mine subsidence	64
insurance underwriting association, there is hereby created a mine	65
subsidence insurance governing board consisting of the director of	66
natural resources or histhe director's designee, as chairman	67
chairperson, the treasurer of state or histhe treasurer of	68
state's designee, the superintendent of insurance or histhe	69
superintendent's designee, and one representative from member	70
companies. The representative from member companies shall be an	71
Ohio domiciled member, elected every three years by members of the	72
association. The representative shall be elected at a meeting of	73
the members or their authorized representatives, which shall be	74
held at a time and place designated by the superintendent. All	75
actions of the mine subsidence insurance underwriting association	76
shall be approved by the governing board. The board may employ,	77
compensate, and prescribe the duties and powers of such employees	78
and consultants as are necessary to carry out sections 3929.50 to	79
3929.61 of the Revised Code, and is authorized to enter into a	80
contract with the Ohio fair plan underwriting association for	81
administrative and claims adjusting services.	82

Sec. 3929.52.  There is hereby created the mine subsidence	83
insurance fund, which shall be administered by the mine subsidence	84
insurance governing board for the purpose of making available	85
insurance coverage against mine subsidence as to any structure	86
within this state. All of the following apply to the fund:	87

(A) The moneys in the fund shall be derived from	88
appropriations by the state and premiums for reinsurance assumed	89
by the mine subsidence insurance underwriting association on	90
policies written by members of the association.	91

(B) Premiums on mine subsidence coverage in policies written	92
by members of the association shall be established by the plan of	93
operation at a rate or within a schedule of rates sufficient to	94
satisfy all foreseeable claims upon the fund during the period of	95
coverage, giving due consideration to relevant loss or claim	96
experience or trends, to cover normal costs of operation of the	97
fund, and to provide a reasonable reserve for unexpected	98
contingencies. No deviation shall be allowed from the premium	99
established by the plan, but the mine subsidence insurance	100
governing board shall periodically review the premium level and	101
the experience data applicable to operation of the fund and, with	102
the approval of the superintendent of insurance, make changes as	103
required. However, the premium level for mine subsidence coverage	104
in any policy delivered, issued for delivery, or renewed in a	105
county designated for optional coverage by the board in accordance	106
with division (B)(1)(A)(2) of section 3929.56 of the Revised Code	107
shall not exceed an annual rate that is greater than twenty	108
dollars, and the premium level for mine subsidence coverage in any	109
policy delivered, issued for delivery, or renewed in a county	110
listed in division (A)(1) of section 3929.56 of the Revised Code	111
shall not exceed an annual rate that is greater than five dollars.	112

(C) Sections 3929.50 to 3929.61 of the Revised Code do not	113
create any liability on the part of the state beyond the amounts	114
paid into the fund and earned by the fund, nor is any liability	115
created on the part of the mine subsidence insurance underwriting	116
association or its members, the Ohio fair plan underwriting	117
association, or the Ohio insurance guaranty association or its	118
members.	119

(D) The treasurer of state shall be the custodian of the	120
fund, which shall not be a part of the state treasury. All	121
disbursements from the fund shall be paid by the treasurer of	122
state upon requisitions signed by the chairmanchairperson of the	123
mine subsidence insurance governing board or histhe chairperson's	124
designee. The chairmanchairperson of the mine subsidence	125
insurance governing board may designate an authorized	126
representative of the Ohio fair plan underwriting association to	127
sign requisitions on the fund if the mine subsidence insurance	128
underwriting association has entered into a contract with the Ohio	129
fair plan underwriting association for administrative and claims	130
adjusting services. The representative, before signing any	131
requisition, shall file with the secretary of state a good and	132
sufficient bond payable to the state to insure the faithful	133
performance of histhe representative's duty, in such sum as the	134
board requires.	135

(E) At the expiration of each fiscal year any amount in the	136
fund which the govening board determines to be safely	137
distributable, after reimbursing the federal special revenue fund	138
for amounts appropriated to the mine subsidence insurance board,	139
shall be distributed among current policyholders in proportion to	140
the premiums paid by them.	141

Sec. 3929.56.  (A)(1) Every insurer that offers basic	142
property and homeowners insurance insuring on a direct basis a	143
structure located in the counties of Athens, Belmont, Carroll,	144
Columbiana, Coshocton, Gallia, Guernsey, Harrison, Hocking,	145
Holmes, Jackson, Jefferson, Lawrence, Mahoning, Meigs, Monroe,	146
Morgan, Muskingum, Noble, Perry, Scioto, Stark, Trumbull,	147
Tuscarawas, Vinton, and Washington shall include mine subsidence	148
coverage provided by the Ohio mine subsidence insurance	149
underwriting association in each policy of basic property and	150
homeowners insurance that is delivered, issued for delivery, or	151
renewed in any of such counties on or after January 1, 1993.	152

(B)(1) The mine subsidence insurance governing board may	153
designate any county, other than a county listed in division (A)	154
of this section, in which mine subsidence coverage must be	155
offered, on an optional basis, by an insurer in accordance with	156
division (B)(2) of this section. Any designation made by the board	157
under division (B)(1) of this section shall be made by the board	158
in the plan of operation of the association and shall be based on	159
a county's risk of loss due to mine subsidence and other criteria	160
established by the board.	161

(2) Every insurer that offers basic property and homeowners	162
insurance insuring on a direct basis a structure located in any	163
county designated by the board in accordance with division (B)(1)	164
of this sectionthe counties of Delaware, Erie, Geauga, Lake,	165
Licking, Medina, Ottawa, Portage, Preble, Summit, and Wayne shall	166
offer to include, on an optional basis, mine subsidence coverage	167
provided by the association in each policy of basic property and	168
homeowers insurance that is delivered, issued for delivery, or	169
renewed in any such designated county on or after January 1, 1993.	170

(C)(B) The premium charged for mine subsidence coverage shall	171
be the same as the premium level set by the plan of operation	172
formulated pursuant to section 3929.53 of the Revised Code. The	173
loss covered shall be the loss in excess of two per cent of the	174
policy's total insured valueAny deductible shall be expressed in	175
the mine subsidence coverage form as approved by the mine	176
subsidence insurance governing board and approved by the	177
superintendent of insurance, but at no time shall the deductible	178
be less than two hundred fifty dollars or more than five hundred	179
dollars, and the total insured value reinsured by the association	180
shall not exceed fiftythree hundred thousand dollars. This	181
section does notpreclude any insurance company from selling	182
insurance coverage under this section in excess of fiftythree	183
hundred thousand dollars.	184

Sec. 3929.58.  All companies authorized to write basic	185
property insurance in this state shall enter into a reinsurance	186
agreement with the Ohio mine subsidence insurance underwriting	187
association in which each company agrees to cede one hundred per	188
cent, up to fiftythree hundred thousand dollars, of any	189
subsidence insurance underwritten to the association and, in	190
consideration of the ceding commission retained by the company,	191
agrees to undertake payment of taxes and all other expenses of the	192
company necessary for sale of policies. The association shall	193
agree to provide a claims adjusting staff and to pay from the mine	194
subsidence insurance fund all valid policyholder claims resulting	195
from subsidence.	196

Sec. 3929.59.  Thirty per cent of all mine subsidence	197
insurance premiums collected by each insurer for policies	198
delivered, issued for delivery, or renewed in a county designated	199
for optional coverage in accordance with division (B)(1)(A)(2) of	200
section 3929.56 of the Revised Code, excluding premiums collected	201
under such policies for mine subsidence insurance coverage which	202
is not reinsured by the mine subsidence insurance underwriting	203
association, shall be retained by the insurer as a ceding	204
commission. The remainder of such premiums shall be remitted by	205
the insurer to the mine subsidence insurance underwriting	206
association.	207

Section 2. That existing sections 3929.50, 3929.51, 3929.52,	208
3929.56, 3929.58, and 3929.59 of the Revised Code are hereby	209
repealed.	210