HB 13-1225: Homeowner's Insurance Reform Act of 2013

• Insurers must offer extended replacement-cost coverage (at least 20% of dwelling limit) and law and ordinance coverage (at least 10% of dwelling limit) before issuing or renewing replacement-cost homeowner policies with dwelling limits equal to or greater than estimated replacement cost.

• All replacement-cost homeowner policies must include additional living expense (ALE) coverage for at least 12 months, with insurers required to offer the option to purchase up to 24 months of ALE coverage.

• All homeowner insurance policy text, endorsements, and disclosure forms must comply with readability standards—not exceeding tenth-grade reading level using the Flesch-Kincaid formula or scoring at least 50 on the Flesch Reading Ease formula, with full compliance required by January 1, 2015.

• Policyholders may submit inventory of lost or damaged property for up to 365 days after a total loss claim and may receive recoverable depreciation for up to 365 days after ALE expires; insurers must offer minimum 30% of contents coverage value without requiring inventory for total losses of furnished primary residences.

• Homeowners may file suit against insurers within the applicable statute of limitations rather than shorter timeframes required by policy provisions; effective January 1, 2014, insurers cannot issue new policies with lawsuit deadlines shorter than the statute of limitations.