Alabama Governor Signs Self-Storage Limited-Lines Insurance Bill

Alabama became the 28th state to either establish a self-storage limited-lines insurance license or provide a statutory exemption from licensing last month when Gov. Kay Ivey signed House Bill 419 (HB 419) into law. The measure allows limited licenses to be issued to storage facility owners, with employees and other company representatives also authorized to operate under the document, according to the national Self Storage Association (SSA), which supported the bill. It goes into effect on July 1.

The law allows operators to sell tenant insurance retroactive to an initial lease signing as long as it’s made part of the rental agreement. Self-storage businesses may receive compensation for selling, billing and collection of services, though charges for insurance coverage must be itemized, SSA officials said. There aren’t any pre-licensing or education requirements.

If a rental agreement requires customers to carry an insurance policy, tenants may opt to provide proof of coverage other than the product offered by the operator. Policies sold through the storage business can cover loss or damage that occurs at the facility or while in transit to the storage property. Policies may also cover losses related to the rental agreement.

“We expect the Alabama Department of Insurance to issue a license application within the next few months,” SSA officials said in an April 9 e-mail newsletter to its members.

HB 419 sailed through the house 95-0 on Feb. 27 and passed the senate 24-0 on March 21. Ivey signed the bill on March 22.

The association is also pressing for tenant-insurance bills in Delaware, Nebraska and Pennsylvania.

Sources:
The Monday Morning Globe 4/9/18, AL Governor Signs Limited Lines Bill; More States Likely to Follow
Open States, HB 419

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