To Amend The Law Concerning Disclosure Of Deductibles Under Certain Insurance Policies.
Summary
SB48 amends Arkansas insurance law to require clearer disclosure of deductibles in owner-occupied residential property insurance policies. For policies that use a deductible based on a percentage of insured value, the insurer must disclose the actual dollar amount of that deductible on the policy declaration page or renewal notice, except for earthquake losses. The bill also adds a new general disclosure requirement for all owner-occupied residential property policies to list all deductibles in a clear and conspicuous manner so policyholders can readily identify any applicable deductible amounts.
The bill further requires that, when a policy has separate deductible levels by peril, those deductible amounts must be shown together with any all-peril deductible on the declaration page or renewal notice. In practical terms, the measure is aimed at making homeowners’ insurance terms easier to understand and reducing the chance that insureds are surprised by the out-of-pocket cost after a loss. It applies to policies issued or renewed in Arkansas and affects insurers writing owner-occupied residential property coverage.
Impact
SB48 changes Arkansas Code § 23-79-168 and adds a new section in Title 23, Chapter 79, Subchapter 1, expanding disclosure obligations for insurers. The law now requires insurers to present deductible information more transparently on declaration pages or renewal notices, including converting percentage-based deductibles into dollar amounts and listing separate peril deductibles together. The primary parties affected are insurers and homeowners with owner-occupied residential property policies, especially those with percentage deductibles or multiple peril-specific deductibles.
Sentiment
The bill appears to have been broadly supported and noncontroversial. It passed the Senate 35-0 and the House 97-0 on third reading, indicating unanimous approval in both chambers. The lack of committee transcript discussion also suggests there was little public or legislative opposition, and the measure was viewed as a consumer-protection and disclosure improvement rather than a substantive change to coverage terms.
Contention
No notable contention is reflected in the available record. The bill’s main policy choice is to require more explicit deductible disclosure, which could impose modest administrative changes on insurers, but no opposition is shown in the votes or transcripts. Any potential concern would likely center on implementation details for insurers and how percentage deductibles are translated and displayed, but those issues were not raised in the available materials.