§ 58-45-5. Definition of terms. - North Carolina Statutes

§ 58‑45‑5. Definition of terms.

As used in this Article,unless the context clearly otherwise requires:

(1)        Association. – TheNorth Carolina Insurance Underwriting Association established under thisArticle.

(2)        Beach area. – All ofthat area of the State of North Carolina south and east of the inland waterwayfrom the South Carolina line to Fort Macon (Beaufort Inlet); thence south andeast of Core, Pamlico, Roanoke and Currituck sounds to the Virginia line, beingthose portions of land generally known as the Outer Banks.

(2a)      Catastrophe recoverycharge. – Any charge collected by member insurers from policyholders statewide,including any charge collected by the Association and Fair Plan from theirpolicyholders, upon issuance or renewal of residential and commercial propertyinsurance policies, other than National Flood Insurance policies, after adeficit event has occurred as provided in G.S. 58‑45‑47. The amountof the catastrophe recovery charge collected in a particular year shall notexceed an aggregate amount of ten percent (10%) of policy premium. Thecatastrophe recovery charge shall be limited to the recovery of lossesresulting from claims for property damage, allocated loss expenses, and actualcosts and expenses directly resulting from the catastrophe recovery chargeplan.

(2b)      Coastal area. – Allof that area of the State of North Carolina comprising the following counties:Beaufort, Brunswick, Camden, Carteret, Chowan, Craven, Currituck, Dare, Hyde,Jones, New Hanover, Onslow, Pamlico, Pasquotank, Pender, Perquimans, Tyrrell,and Washington. "Coastal area" does not include the portions of thesecounties that lie within the beach area.

(2c)      Coastal PropertyInsurance Pool. – The name of which was formerly known as "the BeachPlan" and which is governed by the North Carolina Insurance UnderwritingAssociation. All references to "the Beach Plan" shall mean theCoastal Property Insurance Pool, which is the market of last resort provided bythe Association to the beach area and the coastal area.

(3)        Repealed by SessionLaws 1991, c. 720, s. 6.

(3a)      Crime insurance. – Insuranceagainst losses resulting from robbery, burglary, larceny, and similar crimes,as more specifically defined and limited in the various crime insurancepolicies, or their successor forms of coverage, approved by the Commissionerand issued by the Association. Such policies shall not be more restrictive thanthose issued under the Federal Crime Insurance Program authorized by Public Law91‑609.

(3b)      Directors. – TheBoard of Directors of the Association.

(4)        Essential propertyinsurance. – Insurance against direct loss to property as defined in thestandard statutory fire policy and extended coverage, vandalism and maliciousmischief endorsements thereon, or their successor forms of coverage, asapproved by the Commissioner.

(5)        Insurable property.– Real property at fixed locations in the beach and coastal area, includingtravel trailers when tied down at a fixed location, or the tangible personalproperty located therein, but shall not include insurance on motor vehicles;which property is determined by the Association, after inspection and under thecriteria specified in the plan of operation, to be in an insurable condition.However, any one and two family dwellings built in substantial accordance withthe Federal Manufactured Home Construction and Safety Standards, anypredecessor or successor federal or State construction or safety standards, andany further construction or safety standards promulgated by the association andapproved by the Commissioner, or the North Carolina Uniform ResidentialBuilding Code and any structure or building built in substantial compliancewith the North Carolina State Building Code, including the design‑windrequirements, which is not otherwise rendered uninsurable by reason of use oroccupancy, shall be an insurable risk within the meaning of this Article.However, none of the following factors shall be considered in determininginsurable condition: neighborhood, area, location, environmental hazards beyondthe control of the applicant or owner of the property. Also, any structurebegun on or after January 1, 1970, not built in substantial compliance with theFederal Manufactured Home Construction and Safety Standards, any predecessor orsuccessor federal or State construction or safety standards, and any furtherconstruction or safety standards promulgated by the association and approved bythe Commissioner, or the North Carolina Uniform Residential Building Code orthe North Carolina State Building Code, including the design‑windrequirements therein, shall not be an insurable risk. The owner or applicantshall furnish with the application proof in the form of a certificate from alocal building inspector, contractor, engineer or architect that the structureis built in substantial accordance with the Federal Manufactured HomeConstruction and Safety Standards, any predecessor or successor federal orState construction or safety standards, and any further construction or safetystandards promulgated by the association and approved by the Commissioner, orthe North Carolina Uniform Residential Building Code or the North CarolinaState Building Code; however, an individual certificate shall not be necessarywhere the structure is located within a political subdivision which hascertified to the Association on an annual basis that it is enforcing the NorthCarolina Uniform Residential Building Code or the North Carolina State BuildingCode and has no plans to discontinue enforcing these codes during that year.

(6)        Repealed by SessionLaws 1995 (Regular Session, 1996), c. 592, s. 2.

(6a)      Named storm. – Aweather‑related event involving wind that has been assigned a formal nameby the National Hurricane Center, National Weather Service, WorldMeteorological Association, or any other generally recognized scientific ormeteorological association that provides formal names for public use andreference. A named storm includes hurricanes, tropical depressions, andtropical storms.

(6b)      Net direct premiums.– Gross direct premiums (excluding reinsurance assumed and ceded) written onproperty in this State for essential property insurance, farmowners insurance,homeowners insurance, and the property portion of commercial multiple perilinsurance policies as computed by the Commissioner, less:

a.         Return premiums onuncancelled contracts;

b.         Dividends paid orcredited to policyholders; and

c.         The unused orunabsorbed portion of premium deposits.

(6c)      Nonrecoupableassessment. – Any assessment levied on and payable by members of theAssociation that is not directly recoverable from policyholders. Prospectiveexposure to nonrecoupable assessments shall be considered as an appropriatefactor in the making of rates by the North Carolina Rate Bureau.

(7)        Plan of operation. –The plan of operation of the Association approved or promulgated by theCommissioner under this Article.

(8)        Voluntary market. – Insurancewritten voluntarily by companies other than through this Article or Article 46of this Chapter.

(9)        Voluntary market rates.– Property insurance rates determined or permitted under Article 36, 40, or 41of this Chapter.  (1967,c. 1111, s. 1; 1969, c. 249; 1979, c. 601, ss. 2, 3; 1985, c. 516, s. 1; 1985(Reg. Sess., 1986), c. 1027, ss. 21, 25; 1987 (Reg. Sess., 1988), c. 975, ss.18, 19; 1991, c. 720, ss. 4, 6; 1991 (Reg. Sess., 1992), c. 784, s. 4; 1995(Reg. Sess., 1996), c. 592, s. 2; 1997‑498, s. 1; 2009‑472, s. 1.)