2023 Laws of Puerto Rico › TITLE TWENTY-SIX - Insurance (§§ 101 — 10377) › Subtitle 1 - Insurance Generally (§§ 101 — 4513) › Chapter 27 - Unfair Practices and Frauds (§§ 2701 — 2740) › § 2708a - Prohibited property insurance practices

In the offering and underwriting of property insurance policies that cover windstorm or earthquake risks, the following shall be observed:
(1) Except as provided in subsection (2) of this section, no insurer shall refuse to offer the minimum required deductible to an insurance applicant or an insured person who requests the same. For the purposes of this section, “minimum required deductible” means that portion of the amount of a covered claim that the insured must assume for windstorm and earthquake risks, which shall be as described below:
(a) One percent (1%) of the limit of the policy applicable to the dangers of windstorms, with a minimum deductible of not more than five hundred dollars ($500).
(b) Three percent (3%) of the limit of the policy applicable to the dangers of earthquakes, with a minimum deductible of not more than five hundred dollars ($300) [sic].
(2) If there is a surplus for the policy holders of an insurer, or the size of the catastrophic reserves, pursuant to §§ 2501–2509 of this title, or the conditions of the world reinsurance market, or other valid reasons, prevent the insurer from offering the required minimum deductible, the latter shall provide justification to that effect to the Commissioner, requesting to be allowed to offer larger deductibles. Approval of the offering of deductibles greater than the required minimum deductible shall have a maximum effectiveness of two (2) years, after which the insurer shall again justify the offering of such deductibles and obtain the approval of the Commissioner. Said application shall be made not less than six (6) months in advance of the expiration of the above mentioned period of two (2) years.
(3)
(a) No insurer shall offer any policy in Puerto Rico that establishes deductibles that appear as a percentage of the value of the insured property, unless the value of said property is agreed upon beforehand in the policy (agreed value) between the insured and the insurer.
(b) Provided that a policy contains a provision concerning a deductible appears as a percentage of the limit of the policy, the insurer shall clearly and explicitly state in the policy the dollar amount represented by said percentage.
(4) The provision concerning the minimum deductible required, established in subsection (1) of this section, shall not apply to policies that cover commercial properties, it being understood that the condominiums of substantially residential use do not constitute commercial properties. Any condominium with a residential occupancy of not less than ninety percent (90%) of the total area of the condominium shall be deemed to be substantially residential.
(5) Unless the insured or the prospective insured person chooses another arrangement, each insurer shall offer as [an] option, if available, a clause indicating a deductible prorated in percentage terms in any property policy that covers or shall cover a condominium for windstorm or earthquake hazards. Said deductible prorated in percentage terms shall require the application of deductibles in the case of losses in units of a condominium or in its common areas, in proportion to the ratio between the area of said units and the common areas thus affected and the total area of the condominium.
(6) The offering or issuing of each insurance policy, certificate or insurance endorsement in contravention of the provisions of this section, shall constitute a separate violation.
History —Ins. Code, added as § 27.081 on Aug. 18, 1999, No. 273, § 1; renumbered as § 27.060 and amended on Aug. 9, 2008, No. 230, § 6, eff. 90 days after Aug. 9, 2008.