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Albany Update 01.24.24
DFS Proposes Circular Letter on Artificial Intelligence and External Consumer Data
On January 17 DFS issued a proposed circular letter, to all insurers authorized to write insurance, all licensed fraternal benefit societies, and the New York State Insurance Fund, on the use of “Artificial Intelligence Systems and External Consumer Data and Information Sources in Insurance Underwriting and Pricing.”
By its terms, this letter defines Artificial Intelligence Systems (AIS) and external consumer data and information sources (ECDIS), and provided that all insurers should not use ECDIS or AIS for underwriting or pricing purposes, unless they can establish that the data source or model, as applicable, does not use and is not based in any way on any class protected pursuant to Insurance Law Article 26, and that they should further not use ECDIS or AIS for underwriting or pricing purposes, if such use would result in, or permit, any unfair discrimination or otherwise violate the Insurance Law, or regulations promulgated thereunder.
There is a corresponding 60-day comment period, which means comments are due by March 17 to DFS at innovation@dfs.ny.gov. If you would like NYIA to submit feedback on this proposed circular letter on your behalf, contact Bob Farley at bfarley@nyia.org by Wednesday, March 6. NYIA will also be scheduling a meeting to discuss the proposed circular over the coming weeks and encourage companies to include your subject matter experts. We will be sending a notice with the meeting details in the near future.
DFS Testifies at Budget Hearing
New York State Department of Financial Services (DFS) Superintendent Adrienne Harris presented testimony to the Senate and Assembly at the budget hearing yesterday, January 23. In her testimony, the superintendent highlighted the transformation of the department over her two year tenure, including her championing of initiatives to make DFS more data driven, and the development of a strategic plan of “policy, process and people.” You can view DFS’s written testimony as well as a recording of the hearing.
When it comes to personnel resources, Superintendent Harris touted the fact, that since her initial appointment, DFS has hired 336 new team members, promoted 309 existing personnel, and has significantly expanded their network of collaborative partners, including advocates, industry leaders, legislators and regulators. During the question period the superintendent indicated that if DFS could hire more staff the agency would be able to better address the backlog that exists.
The superintendent also focused on the several DFS led policy initiative contained last week in Governor Hochul’s proposed budget and Article VII legislation., including Part FF of the Transportation, Economic Development and Environmental Conservation Bill (A8806/S8306). This measure would prohibit insurance companies from inquiring on an application, canceling, refusing to issue, refusing to renew or increasing the premium of a policy based on the level or source of income of tenants, on any affordable housing property.
Senate Insurance Committee Advances Two Bills
On Monday, January 22, the Senate Insurance Committee advanced two bills related to property and casualty insurance. These bills included S8167 by Senator Breslin, which would direct DFS to conduct a study on the factors impacting the cost and availability of flood coverage as well as analyze the possibility of supporting a private flood insurance market. NYIA is neutral on the legislation as it is a study bill.
The second bill, S8320A by Senator Mayer, would expand the properties required to be contained in the coastal market assistance program (C-MAP) to include all properties in New York that are located within one mile of the shore. These “shore” properties would be defined as properties located along a salt-water ocean, sound, bay, inlet, or Lake Erie, Lake Ontario, the Saint Lawrence River or the Niagara River. The one-mile distance would be measured from mean high-water mark of such waterways. If your company has feedback on this legislation, please contact Bob Farley at bfarley@nyia.org.
Both of these bills were reported from the Insurance Committee to the Senate Calendar.
DMV Proposes Regulatory Amendment Related to RRGs
As was announced on the last bi-weekly call, the New York State Department of Motor Vehicles (DMV) issued a proposed regulatory amendment (refer to page 3 of the document) to expand the definition of insurance company, to include certain risk retention groups (RRGs), with respect to automobile insurance. This proposed regulation is in response to a bill signed at the end of 2023, and a corresponding chapter amendment that has now passed both houses, S8053 (Webb)/A8505 (Kelles) which authorizes RRGs to write auto insurance for certain nonprofit organizations.
There is a corresponding 60-day comment period with this proposed regulation, which means comments are due by March 17 to DMV at dmv.sm.legal@dmv.ny.gov. If you would like NYIA to submit feedback on this proposed regulation on your behalf, please contact Bob Farley at bfarley@nyia.org by Wednesday, March 13.
WCB Releases 2024 Regulatory Agenda
On January 24 the New York State Workers Compensation Board (WCB) released its 2024 Regulatory Agenda. WCB is considering proposing regulations to amend section 442.2 to update the DME Fee Schedules, amend section 329-1.3 to update the Medical Fee Schedule(s), amend section 441.2 to update the NY Workers’ Compensation Formulary, implement the performance standard referenced in Workers’ Compensation Law section 13-a(6)(b)(i), add a new section 329-1.4 regarding when Intraoperative Neurophysiological Monitoring (IOM) as appropriate, and proposals in support of OnBoard. NYIA will of course keep our members informed on any developments with these proposals.
WCB Launches Online Injured Worker’s Toolkit
WCB has posted on its website, a new suite of tools and information for injured workers known as the Injured Worker’s Toolkit. This web-based resource posts information about the role of WCB, workers compensation benefits, including medical care, lost wages, and survivor benefits. This tool kit also offers suggestions to injured employees on what they should do following a work-related accident or illness including information about legal representation, how the claims process works and workers compensation board support services. It lastly offers information, resources and sections for injured employees seeking to return to work, frequently asked questions, a definition of terms, and forms.
Senate Releases Analysis of Executive Budget
The New York State Senate has released its annual Blue Book, which is its analysis of Governor Hochul’s proposed Executive Budget. This 2024-2025 Blue Book offers the Senate Majority’s perspective on the proposals advanced by the Executive.