The South Carolina Senate gave final approval today to theinsurer-supported Omnibus Coast Property Insurance Reform Act.

Joel Sawyer, a spokesman for Republican Gov. Mark Sanford, saidthe governor will sign the bill, which probably will not reach hisdesk until next week.

The Property Casualty Insurers Association of America (PCI) saidthe governor and legislature, by moving the measure, were"advancing a positive agenda of reform that in the long run willstrengthen the state's coastal insurance market."

Among the items in the bill (HB 3820) is a provision for alimited expansion of the South Carolina Wind and Hail UnderwritingAssociation, as well as a requirement that it be the "market oflast resort" and not offer rates competitive with the privatemarket.

It puts into law a Department of Insurance order that expandedfor two years the territories available for coverage through thewindpool.

Additionally, the bill would let insurance policyholders createspecial tax-free catastrophe savings accounts for payment of a homepolicy windstorm deductible.

Provisions also grant special tax credits for a homeownerretrofitting a house to make it more resistant to "hurricane,rising water or other catastrophic wind event."

In addition, the measure prohibits an insurer from non-renewinga policy during hurricane season without 90 days notice, and allowsa consumer 30 days to appeal a non-renewal.

Robert Herlong, vice president and regional manager for PCI,said the legislation contains "promising steps that could helpprovide stability to the state's insurance market."

PCI, he said, believes "this effort is the type of innovativethinking that is needed to attract capital to the state. SouthCarolina appears to be on track with a well-reasoned approach,rather than a quick-fix solution that could ultimately becounterproductive."

In PCI's view, a key part of the long-term solution to naturalcatastrophe exposure is to expand private-sector capacity to handlethe risk, and the organization backs efforts to make markets moreresponsive to risks.

Mr. Herlong praised the provisions dealing with mitigation,saying that "roughly one dollar spent to better protect a propertyresults in four dollars saved following an event."

He said "the approach outlined in this bill and several beingconsidered at the federal level would give homeowners themselvesadditional incentives to make improvements, and would save manydollars later in disaster assistance and other government programs.These are the efforts that truly help to bring down the cost ofinsurance."

The South Carolina action is at sharp variance with legislativemoves in Florida, where the state's disaster fund was expanded tosell discount reinsurance and insurers were required to reducerates as a result.

Alex Sink, Florida's chief financial officer, said the move hasleft the fund under-reserved, and that the state's insurer of lastresort, Citizens, was expanded to take on more risk that wasactuarially unsound.

Des Plaines, Ill.-based PCI is composed of more than 1,000member companies.