A bill proposed in the wake of Superstorm Sandy that would haveinsurers produce a single-page summary of a homeowners policy inNew Jersey moved a step closer to passage after an Assemblycommittee approved language the industry can live with.

Yesterday, the Financial Institutions and Insurance Committeesent to the Assembly floor a bill (A-3642) that would require insurers writing homeownerspolicies to provide a consumer-information brochure "written in asimple, clear, understandable, and easily readable way" explainingthe hurricane deductible and providing information about floodinsurance.

As first reported in the The Star-Ledger, the reason for the bill isthat Superstorm Sandy demonstrated that consumers do not understandtheir insurance policies and the bill is an effort to clear-up thatconfusion, explained Assemblyman Gary Schaer, D-Bergen and Passaic,a primary sponsor.

Under the legislation, the one-page summary insurers would berequired to provide would explain notable coverages and exclusionsas determined by the Commissioner of Banking and Insurance.

Chuck Leitgeb, vice president of the Insurance Council of NewJersey, who testified at yesterday's committee hearing, toldPC360 that the bill as it now stands "is something[insurers] can live with."

He says insurers' original objection to the bill was fear thatit would be interpreted as the language in the insurance policy.The amended legislation makes it clear that the summary does notserve as replacement for policy language and does not change themeaning of the policy in any way.

Leitgeb says the industry understands the reasons for theAssembly's action, and insurers support the bill as it currentlyis. He believes much of the confusion after Sandy stemmed fromconsumers not understanding who provides flood coverage.

However, he emphasized that "there is no substitute forconsumers reading their policy and asking questions."

The ultimate goal, he says, is educating the consumer. Hecredited both the New Jersey Department of Banking and Insuranceand the Insurance Information Institute with putting informationout there for consumer to view. The challenge, he says, is gettingconsumers to pay attention and focus on the purchase of theirhomeowners insurance with as much attention as they do a newcar.

"The goal is to get better information to the consumer and getthem be more focused on what is in their policy," says Leitgeb.

A companion bill is waiting introduction in the State Senate andis awaiting re-introduction in the Assembly.