A BILL TO BE ENTITLED
AN ACT to reduce the impact to taxpayers of natural disasters and other insurable risks by enhancing insurance coverage for Public buildings.
The General Assembly of North Carolina enacts:

STATE PROPERTY INSURANCE FUND AMENDMENTS
SECTION 1.(a) Article 31 of Chapter 58 of the General Statutes reads as rewritten:
"Article 31.
"Insuring State Property, Officials and Employees.
"§ 58‑31‑1.  State Property Insurance Fund created.
Upon the expiration of all existing policies of fire insurance upon state‑owned buildings, fixtures, furniture, and equipment, including all such property the title to which may be in any State department, institution, or agency, the State of North Carolina shall not reinsure any of such properties.
There is hereby created a "State Property Insurance Fund," which shall be as a special fund in the State treasury, for the purpose of providing a reserve against loss from fire and other perils as specified in this Article at State departments and institutions. The State Treasurer shall be the custodian of the "State Property Insurance Fund" and shall invest its assets in accordance with the provisions of G.S. 147‑69.2 and 147‑69.3.
"§ 58‑31‑5.  Appropriations; fund to pay administrative expenses.
Each year the Commissioner shall file with the Department of Administration an estimate of the appropriations which will be necessary in order to set up and maintain an adequate reserve in the State Property Insurance Fund to provide coverage sufficient to protect the State, its departments, institutions, and agencies from loss or damage to any of said properties up to seventy‑five percent (75%) of the value thereof. To maintain adequate coverage levels, the Commissioner shall annually adjust by two percent (2%) the value of all State property covered by the State Property Insurance Fund. Appropriations made for the creating of such fire insurance reserves against property of the Department of Agriculture and Consumer Services, or the Department of Transportation or any special operating fund shall be charged against the funds of such departments.
The State Property Insurance Fund is authorized and empowered to pay all the administrative expenses occasioned by the administration of this Article.
"§ 58‑31‑10.  Payment of losses on basis of actual cost of restoration or replacement; rules; insurance and reinsurance.
(a)	In the case of total or partial loss of any property of any State agency or institution, the Commissioner shall determine the amount of loss and certify that amount to the agency or institution concerned and to the Director of the Budget and Council of State. The Director of the Budget and Council of State may authorize transfers from the Fund to the agency or institution that suffered the loss in amounts that are necessary to pay for the actual cost of restoration or replacement of the property. In the event there is not a sufficient amount in the Fund to pay for the actual cost of restoration or replacement, the Director of the Budget and the Council of State may supplement the Fund by transferring amounts from the Contingency and Emergency Fund.
(b)	The Commissioner, with the approval of the Council of State, is authorized to adopt rules necessary to carry out the purpose of this Article, which rules shall be binding on all State agencies and institutions. The Commissioner shall purchase from qualified insurers insurance or reinsurance necessary to protect the Fund against loss on any one building and its contents in excess of fifty thousand dollars ($50,000), and the premiums for this coverage shall be paid by each requesting department, agency, or institution in accordance with rates fixed by the Commissioner.
	
"§ 58‑31‑12.  Policy forms.
The Commissioner may adopt insurance forms for coverages provided by the State Property Insurance Fund under this Article.
"§ 58‑31‑13.  Hazardous conditions in State‑owned buildings.
If the Commissioner determines that an undue hazard to life, safety, or property exists because of a condition or the use of a building owned by the State, the Commissioner shall advise the proper agency how to limit or prohibit use of the building until the hazard is abated.
"§ 58‑31‑15.  Extended coverage insurance required.
Every State department, agency or institution shall obtain extended coverage insurance and any other property insurance coverages that the Commissioner determines to be appropriate in light of the location, exposure to risk, age, and any other factors the Commissioner finds relevant to ensure appropriate coverage for state‑owned property of such department, agency or institution which is insured by the State PropertyInsurance Fund. Premiums for such insurance coverage shall be paid by each department, agency or institution in accordance with rates fixed by the Commissioner. Losses covered by such insurance may be paid for out of the State Property Insurance Fund as set forth in this Article. The Commissioner, may purchase from insurers admitted to do business in North Carolina such insurance or reinsurance as may be necessary to protect the State Property Insurance Fund against loss with respect to such insurance coverage. The words "extended coverage insurance," as used in this section, shall include, but is not limited to, insurance against loss or damage caused by fire, lightning, windstorm, hail, explosion, riot, riot attending a strike, civil commotion, vandalism, water damage, aircraft, vehicles or smoke.
"§ 58‑31‑18.  Flood insurance.
Flood insurance shall be provided on State‑owned property of each department, agency, or institution which is insured by the State Property Insurance Fund when that property is located, or becomes located, in an area identified on the latest Flood Insurance Rate Map produced by the Federal Emergency Management Agency as an area that will be inundated by the flood event having a one percent (1%) chance of being equaled or exceeded in any given year. Premiums for flood insurance coverage shall be paid by each department, agency, or institution in accordance with rates fixed by the Commissioner, and the Commissioner may purchase from insurers admitted to do business in North Carolina such insurance or reinsurance as may be necessary to protect the State Property Insurance Fund against loss with respect to flood insurance coverage.
"§ 58‑31‑20.  Use and occupancy and business interruption insurance.
Upon request of any State department, agency or institution, use and occupancy and business interruption insurance shall be provided on state‑owned property of such department, agency or institution which is insured by the State Property Insurance Fund. Premiums for such insurance coverage shall be paid by each requesting department, agency or institution in accordance with rates fixed by the Commissioner. Losses covered by such insurance may be paid for out of the State Property Insurance Fund in the same manner as fire losses. The Commissioner, may purchase from insurers admitted to do business in North Carolina such insurance or reinsurance as may be necessary to protect the State Property Insurance Fund against loss with respect to such insurance coverage.
"§ 58‑31‑25.  Professional liability insurance for officials and employees of the State.
The Commissioner may acquire professional liability insurance covering the officers and employees of any State department, institution or agency upon the request of such State department, institution or agency. Premiums for such insurance coverage shall be paid by the requesting department, institution or agency at rates fixed by the Commissioner from funds made available to it for the purpose. The Commissioner, in placing a contract for such insurance is authorized to place such insurance through the Public Officers and Employees' Liability Insurance Commission, and shall exercise all efforts to place such insurance through the said commission prior to attempting to procure such insurance through any other source.
The Commissioner, pursuant to this section, may acquire professional liability insurance covering the officers and employees of a department, institution or agency of State government only if the coverage to be provided by such policy is coverage of claims in excess of the protection provided by Articles 31 and 31A of Chapter 143 of the General Statutes.
The purchase, by any State department, institution or agency of professional liability insurance covering the law‑enforcement officers, officers or employees of such department, institution or agency shall not be construed as a waiver of any defense of sovereign immunity by such department, institution or agency. The purchase of such insurance shall not be deemed a waiver by any employee of the defense of sovereign immunity to the extent that such defense may be available to the Commissioner.
The payment, by any State department, institution or agency of funds as premiums for professional liability insurance through the plan provided herein, covering the law‑enforcement officers or officials or employees of such department, institution or agency is hereby declared to be for a public purpose.
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"§ 58‑31‑35.  Information furnished Commissioner by officers in charge.
It is the duty of the different officers or boards having in their custody any property belonging to the State to inform the Commissioner, giving the Commissioner a full and detailed description of same, and to keep the Commissioner informed of any changes in such property or its location or surroundings.
"§ 58‑31‑40.  Commissioner to inspect State property.
(a)	The Commissioner shall, as often as is required in the fire code adopted by the North Carolina Building Code Council or more often if the Commissioner considers it necessary, visit, inspect, and thoroughly examine every State property to analyze and determine its protection from fire, including the property's occupants or contents. The Commissioner shall notify in writing the agency or official in charge of the property of any defect noted by the Commissioner or any improvement considered by the Commissioner to be necessary, and a copy of that notice shall be forwarded by the Commissioner to the Department of Administration.
(b)	No agency or person authorized or directed by law to select a plan or erect a building comprising 20,000 square feet or more for the use of any county, city, or school district shall receive and approve of the plan until it is submitted to and approved by the Commissioner as to the safety of the proposed building from fire, including the property's occupants or contents.
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SECTION 1.(b)  G.S. 147‑69.2(a)(12) reads as rewritten:
"(12)	The State Property Insurance Fund."
SECTION 2.  This act is effective March 31, 2021.