A trade group survey of independent insurance agents finds NewYork State's coastal homeowners are having difficulty findingcoverage in the primary market and producers are seekingalternative sources for placement.

The Professional Insurance Agents of New York State Inc.conducted a poll of 90 PIANY members in the downstate area of NewYork City, Long Island and Westchester County. The June surveyfound agents saying many primary carriers continue to seekreduction in their coastal exposures.

"With fewer companies and more underwriting restrictions, agentsare turning to alternative markets to write homes close to thewater," said David Dickson, PIANY president.

He said "PIANY is proposing steps to improve the usefulness ofeach type of alternative market for its members and spread the wordabout flood insurance."

Agents' use of the state's official market of last resort, theNew York Property Insurance Underwriting Association (NYPIUA), toinsure coastal homes climbed to 51 percent compared with 47 percentlast year and 41 percent in February 2006.

Use of the excess lines market grew to 76 percent of agentsusing it this year compared with 67 percent last year and 61percent in February 2006.

Most agents say they aren't using the state's Coastal MarketAssistance Program (CMAP). The program encourages regularhomeowners companies to waive distance-to-shore restrictions andaccept coastal homeowners they otherwise would not write whileusing NYPIUA to assume much of the property risk. Only 12 percentof agents said they used CMAP.

PIANY began its survey of downstate members in February 2006, amonth after the Allstate Group stopped accepting new customers andceased policy renewals.

In the survey, 57 percent of respondents said at least one oftheir companies increased its nonrenewals in the past year--morethan double the 24 percent reported last year.

This year, 69 percent of agents surveyed said at least one oftheir companies stopped accepting any new homeowners business. InSuffolk County, the figure is 92 percent. Nine agencies--10 percentof respondents--now have no companies willing to write newhomeowners policies. All but one is located in Suffolk County, LongIsland.

The average number of companies that will write new business forthe 2007 respondents is 3.2; last year, it was 3.8. The averageSuffolk agency has only 2.5 homeowners companies, down from 3.5last year. Nine out of ten Suffolk agencies--89 percent--have fewerhomeowners markets this year.

Insurers continue adding other restrictions, as well. Agenciessaying one or more companies have stricter guidelines on distanceto water: 84 percent this year, 71 percent last year. More orlarger windstorm deductibles: 59 percent this year, 43 percent lastyear.

PIANY said it advocates a number of steps to improve conditionsfor its downstate members. On the legislative front, PIANY wants toincrease the New York State Insurance Department's review ofcompanies' nonrenewal plans.

PIANY also supports an annual policyholder notice about floodinsurance. Homeowners policies exclude coverage for storm surge andother types of flood conditions, but the federal government makessuch coverage available through a special program.

PIANY also advocated permanent legal status for NYPIUA withproperty insurance limits up to $1 million and offering replacementcost coverage, which some mortgage lenders require. NYPIUA shouldhave hurricane deductibles like those used by insurancecompanies.

The NYPIUA plan was renewed by the state legislature last monthfor another year. The program has been the subject of politicalwrangling in the past with both parties using it as politicalleverage in budget negotiations.