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Albany Update 04.20.24

In this issue …

New York State Budget Finalized

After nearly a month of stalemate, and the passage of multiple budget extender bills, on Monday, April 15 Governor Hochul held a press conference to announce a three-way (Governor, Assembly Speaker and Senate Majority Leader) conceptual agreement for the awaited passage of the budget.

On Thursday, April 18, the legislature began to introduce and enact bills for a new state budget. The budget was finalized today, April 20, when both houses finished voting on all the budget bills.

The originally proposed Executive Budget offered a state fiscal plan with $233 billion in state spending, which ended up being $237 billion in the final enacted version. Issues hitting the headlines include several affordable housing initiatives, increased funding for health care, hospitals and nursing homes, and creating a major new AI initiative for SUNY Buffalo.

The public policy provisions within the state budget are contained within the Article VII bills, which are PPGG, ELFA, HMH, TED and REV.  These bills contain thousands of pages and several dozen statutory policy initiatives.

The Quick Scorecard

WIN: No Major Tax Increases on the Property Casualty Insurance Industry
WIN: Proposal on Unfair, Abusive, and Deceptive Trade Practices – Not Included
WIN: Excess Medical Malpractice Insurance Program – Modified to a Straight Extender
WIN: Proposal on Workers Compensation Fine Increase – Not Included
WIN: Proposal on Wrongful Death Expansion – Not Included
WIN: Proposal on Workplace Traumatic Stress for Workers Compensation – Not Included
WIN: Proposal on NY Privacy Act – Not Included

The legislature began to vote on these bills, after receiving messages of necessity from the governor, which allow the bypassing of the three-day aging rule, that would ordinarily require the legislature to have bills in public print for three days, prior to their passage. Due to the messages of necessity, most of these bills were passed within hours of their release to the legislators and the public.

Despite these seriously compressed timelines, please know, that with respect to the policy initiatives that impact the property and casualty insurance industry, NYIA has been tracking such within the budget, from their original proposal to enactment. The following is a summary of the outcome based on our initial review.

Items Included in the Final Budget

Taxes, Assessments and Fees:
In relation to DFS’s budget and the Financial Services Law section 206 assessments, the total DFS budget proposed in the Executive Budget for fiscal year 2025 totals $534 million which represents a 2.3 percent increase from the last fiscal year. This figure includes an increase to the insurance program portion of DFS’s budget, including an increase of more than 3 percent to DFS’s insurance operations and what appears to be a more than 5 percent increase to the sub-allocations. NYIA strenuously advocated for the insurance portion of the budget to remain at these proposed figures or decreased.

The Department of Motor Vehicles proposed assessment to writers of motor vehicle liability insurance for administration of the state’s compulsory insurance program, which includes the insurance information enforcement system (IIES), for the 2025 fiscal year is $11,577,000, which is also flat from the previous fiscal year.

Part F of TED (Transportation, Economic Development and Environmental Conservation A8808C/S8308C) – Extension of Internet Point Insurance Reduction Program – This provision will extend the Internet Point Insurance Reduction Program (IPIRP) until April 1, 2026. Such program, overseen by the State Department of Motor Vehicles, allows drivers to reduce points on their driving record by taking an approved online accident prevention course. Without this legislation this program would have expired on April 1, 2024.

Part J of TED – Autonomous Vehicle Technology Extender – This provision will extend the authority of the Department of Motor Vehicles to continue demonstrations and tests of motor vehicles equipped with autonomous vehicle technology until April 1, 2026. This program would have otherwise expired on April 1, 2024 without this legislation.

 Part K of TED – Stretch Limousine Passenger Safety Act – This provision will amend the Transportation Law and Vehicle and Traffic Law, to establish a comprehensive limousine safety package based upon recommendations from the Stretch Limousine Passenger Safety Task Force.

Part K of HMH (Health and Mental Hygiene A8807C/S8307C) – Excess Medical Malpractice Insurance Straight Extender – This part will enact a straight extender of this program until June 30, 2025. The governor’s original proposal to change this program to require a physician or dentist to pay for 50 percent of the cost of the coverage, was omitted.

 Part BB of ELFA (Education, Labor and Family Assistance A8806B/S8806B) – Affordable Housing Underwriting and Rating – This part would prohibit insurance companies from inquiring on an application, cancelling, refusing to issue, refusing to renew, or increasing the premium of a policy, or excluding, limiting, restricting, or reducing coverage under a policy based on, the following:

• The residential building contains dwelling units that shall be affordable to residents at a specific income level pursuant to a statute, regulation, restrictive declaration, or regulatory agreement with a local, state, or federal government entity;
• The real property owner or tenants of such residential building or the shareholders of a cooperative housing corporation receive rental assistance provided by a local, state, or federal government entity, including, but not limited to, the receipt of federal vouchers issued under section eight of the United States Housing Act of 1937 (42 U.S.C. §1437f);
• The level or source of income of the tenants of the residential building or the shareholders of a cooperative housing corporation; or
• Whether such residential building is owned by a limited-equity cooperative; owned by a public housing authority; or owned by a cooperative housing corporation subject to the provisions of article two, article four, article five or article eleven of the private housing finance law.

The language of this budget bill is identical to Assemblyman Weprin’s Bill A7910A, which was reported from the Assembly Insurance Committee on March 30, 2024.

Part MM of ELFA – Outdoor Dining Permit Requirements – This Part will require any entity that provides for outside dinning, to provide, in its permitting application with the State Liquor Authority, proof that such licensee has obtained workers’ compensation insurance for all employees, as required by the workers’ compensation law, and has obtained general liability insurance to provide coverage against liability for injury sustained by persons on the contiguous municipal public space or non-contiguous municipal public space used by the licensee and, if applicable, persons and cyclists using or crossing a bike thoroughfare that connects the licensed premises to the non-contiguous municipal public space used by the licensee.

This Part will further require that the licensee must also maintain such general liability coverage during the term of its municipal permit or written authorization to use the contiguous municipal public space or non-contiguous municipal public space.

Part OO of ELFA – Authorizes NYC to Lower Speed Limits – This Part will authorize the City of New York to set speed limits, by local law, that provides an explanation of the reasons for setting lower speed limits, how such lower speed limits comply with engineering standards, and how such lower speed limits will ensure that motor vehicles can operate at safe speeds in a manner that optimizes all road users’ safety and convenience.

Part XX of ELFA – Fiscal Transfers – This Part would authorize, in section 19 on page 170, a transfer of $8.4 million from the insurance department special revenue fund, which is funded by the assessment to defray operating expenses authorized by section 206 of the financial services law, to the IT Modernization Capital Fund.

It would further authorize, in section 5 on page 172, a transfer of $115,420,000 from the state police motor vehicle law enforcement and motor vehicle theft and insurance fraud prevention fund, state police motor vehicle enforcement account, to the general fund for state operation expenses of the division of state police. It would additionally authorize in section 12 on page 172, $1,100,000 from the state police motor vehicle law enforcement and motor vehicle theft and insurance fraud prevention fund, motor vehicle theft and insurance fraud account, to the general fund.

Capital Projects Budget Bill (A8804-D/S8304-D) – This Provision on page 403 will establish a $60 million dollar Financial Services IT Modernization Fund, within the Capital Appropriations of the State of New York. Such fund would be for services and expenses, and costs associated with an information technology modernization project, including the payment of liabilities incurred prior to April 1, 2024.  It should be noted that funds from the assessments to defray operating expenses authorized by Section 206 of Financial Services Law, may be transferred into this Financial Services IT Modernization Fund.

Items NOT Included in the Final Budget

Our final review has not revealed any major increased taxes or fees on the property and casualty insurance industry, which means no increase in the premium tax nor an extension of the two percent premium tax to cooperatives.

Part H of PPGG (Public Protection and General Government A8805C/S8305C) – Online Verification System (NYIA initiative) – This Part would have enacted a transition of New York’s motor vehicle liability insurance reporting from the present Insurance Information Enforcement System (IIES), to a modernized, real time, Online Verification System (OLV). This Part was unfortunately deleted from the final budget language, but NYIA has been repeatedly told that there is still interest by both the Governor and the Legislature, to pass a separate, stand alone, bill to accomplish this initiative this year.

Part N of PPGG – Increasing Benefits and Fines under Workers Compensation – This Part would have amended Article 9 of the Workers’ Compensation Law, and Articles 42 and 26 of Insurance Law, to provide substantial increases to the maximum benefit for short-term disability and to increase penalties for violating the workers compensation law to from a current cap of $2,500, to an amount of $2500 per violation.  This Part, which would have significantly increased costs under workers compensation, and which was strongly opposed by NYIA, was thankfully deleted from the final budget.

Part R of PPGG – Lowering Interest Rate on Legal Judgments (NYIA initiative) – This provision would have changed the interest rate on court judgments paid by both public and private entities to the present legal rate of interest (9 percent), to a market rate of interest (the weekly average one-year constant maturity Treasury yield). This Part was deleted from the final budget language, due to lack of interest in both houses of the state legislature.

Part BB of PPGG – New York Privacy Act ­– This provision, advanced by the Senate, which NYIA worked aggressively and hard against, would have amended the general business law to severely restrict and penalize the use of data, and to provide serious disclosure requirements and prohibitions with respect to how personal data is used and stored.  This Part, which was stricken from the budget, was based on S365B by Senator Thomas. Part FFF of PPGG – Wrongful Death – This provision, advanced by the Senate, which NYIA worked aggressively and hard against, would have amended the estates, powers and trust law, to enact the so called “Grieving Families Act,” which would dramatically expand damages and classes of plaintiffs under New York State’s Wrongful Death Law. This Part, which was stricken from the budget, was based on S8485 by Senator Hoylman-Sigal.

Part III of PPGG – Workplace Post-Traumatic Stress – This provision, advanced by the Senate, which NYIA worked aggressively and hard against, would have amended the labor law to expand workers’ compensation coverage for work-related post-traumatic stress disorder. This proposed provision, which was stricken from the budget, was based on S6635 by Senator Ramos, which passed the Senate on April 4, 2024.

Part DD of TED (Transportation, Economic Development and Environmental Conservation A8808C/S8308C) – Supplemental Spousal Liability Insurance – This provision, according to the Governor and the Legislature, sought to correct the problems of last year’s chapter on this subject. While not part of the budget, the final supplemental spousal bill language was agreed to by the Legislature and Governor in connection with the budget.

The bill being advanced separately is S9021A (Breslin)/A9407A (Weprin), which is presently on the third reading calendar in both houses. The most significant change in the amended version of the legislation from the Senate bill that was first introduced is that a notification would now need to be provided at renewal and amendment, under certain circumstances, in addition to the notification at issuance and at least once a year under other specified circumstances.

 Part GG of TED – Lithium-Ion Batteries National Laboratory Certification – This provision would have amended the general business law to prohibit the sale of lithium-ion batteries or refurbished lithium-ion batteries for use in micromobility devices to only batteries that have been certified by a nationally recognized testing and certification laboratory (such as Underwriters Laboratories). This Part, which has the purpose to promote fire safety, was omitted from the amended budget bill, but there remains discussion with the legislature that it could appear later as a separate standalone bill.

Part JJ of TED – Expanding Penalties and Litigation Against Business and Insurers – This provision, which NYIA worked aggressively and hard against, would have amended section 349 of the general business law to recharacterize and make unlawful, certain “Prohibited Acts and Practices,” in the conduct of any business, trade or commerce. Known as UDAP (for unfair, abusive and deceptive practices) this provision would have captured insurers and many other businesses, into a cyclone of what has been referred to as a “litigation bomb,” with extremely amorphous, and in some cases of non-existent standards and definitions, where plaintiff lawyers would be able to develop a cottage industry to bring private right of action lawsuits, where in some cases, no actual harm need even be proven. Thankfully, at least for the present, this part has been stricken from the budget. There has been talk, however, that this proposal may be seen again this session, as a separate bill, so we will all have to remain vigilant on this issue.

Part YY of TED – Captive Insurance Program for Commuter Vans – This provision advanced by the Senate would have amended insurance law to direct the Department of Financial Services to create a captive insurance program for commuter vans, black cars, ambulettes, para-transits, and small school buses. This proposed provision, which NYIA opposed, was stricken from the budget. The proposal was based on S8432 by Senator Comrie. 

Final Thoughts

With the budget process concluded, the legislature will now proceed with its five-week sprint to the end of session. During that time, NYIA will continue to track the thousands of bills under consideration in both the Assembly and the Senate, and strongly advocate for the interests of the property and casualty insurance industry. In the days and weeks ahead, please know we will continue to keep you informed, and remain laser focused on the need and desires of our members.

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Albany Update 04.18.24

In this issue …

New York State Budget Update

At long last, progress appears to be being made toward the final adoption of a New York State Budget. What appears to be the final budget extender, A9852 (Weinstein) / S9083 (Krueger), which would extend appropriations in support of government through Friday, April 19, 2024, is scheduled to go to the floor of both houses for consideration today, April 18, 2024.

Accordingly, it now appears budget votes may start occurring on an actual agreed upon budget, as soon as tomorrow, April 19, 2024. Three of the major budget bills (A8805C/S8305C) The Public Protection and General Government Bill (PPGG), (A8808C/S8308C) The Transportation, Economic Development and Environmental Conservation Bill (TED), and (A8809B/S8309B) Revenue (REV) have been very recently amended, and appear to be ready for legislative passage. Certain important provisions of these three bills, which NYIA has been tracking are as follows:

Part H of PPGG – Online Verification System (NYIA initiative). This provision would have enacted a transition of New York’s motor vehicle liability insurance reporting, from the present Insurance Information Enforcement System (IIES), to a modernized, real time, Online Verification System (OLV). This Part appears to have been deleted from the final budget language, but NYIA has been repeatedly told that there is still interest by both the Governor and the Legislature, to pass a separate, stand alone bill to accomplish this initiative this year.

Part R of PPGG – Lowering Interest Rate on Legal Judgments (NYIA initiative). This provision would have changed the interest rate on court judgments paid by both public and private entities to the present legal rate of interest (9 percent), to a market rate of interest (the weekly average one-year constant maturity Treasury yield). This Part appears to have been deleted from the final budget language, due to lack of interest in both houses of the state legislature.

Part F of TED – Extension of Internet Point Insurance Reduction Program. This provision will extend the Internet Point Insurance Reduction Program (IPIRP) until April 1, 2026. Such program, overseen by the State Department of Motor Vehicles, allows drivers to reduce points on their driving record by taking an approved online accident prevention course. This program would have otherwise expired on April 1, 2024 without this legislation. This Part was included in the amended budget bill.

Part J of TED – Autonomous Vehicle Technology Extender. This provision will extend the authority of the Department of Motor Vehicles to continue demonstrations and tests of motor vehicles equipped with autonomous vehicle technology until April 1, 2026. This program would have otherwise expired on April 1, 2024 without this legislation. This Part was included in the amended budget bill.

Part K of TED – Stretch Limousine Passenger Safety Act. This provision will amend the Transportation Law and Vehicle and Traffic Law, to establish a comprehensive limousine safety package based upon recommendations from the Stretch Limousine Passenger Safety Task Force. This Part was included in the amended budget bill.

Part FF of TED – Affordable Housing Underwriting and Rating. This provision would have prohibited insurance companies from inquiring on an application, or canceling, refusing to issue, refusing to renew or increasing the premium of a policy, based on the level or source of income of tenants, the property containing any residential dwelling units that must be affordable, and the owner or residents receiving government housing subsidies. Thankfully, at least for the present, this part has been stricken from the budget. There has been talk, however, that this proposal may be seen again this session, as a separate bill, so we will all have to remain vigilant on this issue.

Part GG of TED – Lithium-Ion Batteries National Laboratory Certification. This provision would have amended the general business law, to prohibit the sale of lithium-ion batteries or refurbished lithium-ion batteries, for use in micromobility devices, to only those batteries that have been certified by a nationally recognized testing and certification laboratory (such as Underwriters Laboratories). This part, which to promote fire safety and deter insurance losses, caused from fires with malfunctioning lithium batteries, was omitted from the amended budget bill, but there remains discussion with the legislature that it could appear later as a separate stand alone bill.

Part JJ of TED – Expanding Penalties and Litigation Against Business and Insurers. This provision, which NYIA worked aggressively and hard against, would have amended section 349 of the general business law to recharacterize and make unlawful, certain “Prohibited Acts and Practices,” in the conduct of any business, trade or commerce. Known as UDAP (for unfair, abusive and deceptive practices) this provision would have captured insurers and many other businesses, into a cyclone of what has been referred to as a “litigation bomb”, with extremely amorphous, and in some cases of non existent standards and definitions, where plaintiff lawyers would be able to develop a cottage industry to bring private right of action lawsuits, where in some cases, no actual harm need even be proven. Thankfully, at least for the present, this part has been stricken from the budget. There has been talk, however, that this proposal may be seen again this session, as a separate bill, so we will all have to remain vigilant on this issue.

Kindly note, that as of the production of this Albany Update, no amended versions of the other major budget bills, such as (ELFA) – Education, Labor and Family Assistance (presently A8806B/S8306B), (HMH) Health and Mental Hygiene (presently A8807B/S8307B) have been printed or released for public view.

Final Supplemental Spousal Liability Bill Language

While not part of the budget, we have been told the final supplemental spousal bill language was agreed to by the Legislature and Governor in connection with the budget. The Senate bill that was just introduced last week was amended over the weekend, S9021A (Breslin), to include this agreed upon language. The Assembly bill that had already passed in that house was recalled and amended to match the Senate bill, A9407A (Weprin). The most significant change in the amended version of the legislation from the Senate bill that was first introduced is that a notification would now need to be provided at renewal and amendment, under certain circumstances, in addition to the notification at issuance and at least once a year under other specified circumstances.

The effective date is 180 days after the bill is signed with applicability to policies issued, renewed or modified after that date. We are in the process of analyzing the various new or modified requirements and welcome companies letting us know if there are aspects that could benefit from further clarity. Please contact Cassandra Anderson at canderson@nyia.org with questions or comments.

Legal Roundtable Key Takeaways

As many know, on March 21, 2024, NYIA presented a virtual roundtable focused on emerging trends in New York. This well received program featured defense and coverage attorneys from NYIA member firms, including Barclay Damon LLP, Debevoise & Plimpton LLP, Hoffman Roth & Matlin, LLP, Hurwitz Fine, PC, and the Mura Law Group, PLLC. As an additional benefit to members, these firms have put together some key takeaways from their presentations. Feel free to reach out to our presenters with any questions you may have on the topics that were discussed. A thank you to all who participated and presented.

Bills on the Move

Since our last Albany Update, most of the legislative activity has concerned the State Budget. Outside of that endeavor however, there have been a few notable bills that have either been reported from committee or have passed at least one house of the legislature. They are as follows.

S450 (Gianaris) – This bill would prohibit the imposition of different premium rates for disability insurance based on gender.  It passed the Senate on April 16, 2024.  It also passed the Senate last year. Its same as bill, A3781 (Glick), did not pass the Assembly last year and has yet to be considered by the Assembly Insurance Committee this year.

S760B (Liu) – This bill would prohibit reckless driving in parking lots. It passed the Senate on April 15, 2024.  Its same as bill, A402B (Rozic), also passed the Assembly on April 15, 2024. It must now be delivered to the Governor for her consideration before the end of the year.

S1469 (Breslin) – This bill would modernize the insurance law by allowing insurers to take advantage of the Free Trade Zone regardless of whether or not they maintain a physical office in the state. It was reported to the Senate 3rd Reading Calendar from the Senate Insurance Committee on April 15, 2024 and passed the Senate last year. It is hoped that it will pass the Senate this year again. Its same as bill, A8212 (Weprin), is presently in the Assembly Insurance Committee. NYIA, who is in support of this legislation, is working diligently to try to get the Assembly Insurance Committee to consider this bill as well.

S3234A (Hoylman-Sigal) – This bill prohibits the exclusion of coverage based upon gender indication on claims forms. It was also reported to the Senate 3rd Reading Calendar from the Senate Insurance Committee on April 15, 2024, and passed the Senate last year. Its same as bill, A1682A (Woerner), was not considered by the Assembly last session and has not yet been considered this year by the Assembly Insurance Committee.

S3249 (Bailey) – This bill would require the installation of smoke detectors in common places of certain dwellings.  It passed the Senate last year and again this year on April 3, 2024. It currently has no same as bill in the Assembly.

S4057 (Mannion) – This bill would promote the regulation and approval of homeowner natural disaster preparedness, home safety and loss prevention courses by the Department of Financial Services, and direct that DFS issue a Request for Proposal and request for state funding to effectuate the development and promotion of such courses. It was reported from the Senate Insurance Committee to the Senate Finance Committee on April 15, 2024. Its same as bill, A136 (Cruz), has never been considered by the Assembly Insurance Committee.

S5437 (Harckham) – This bill would impose an enormous, new regulatory mandate on all insurance companies, to investigate and assess, all aspects of potential climate change effects, and possible financial impacts on their customers and operations, and to accordingly produce an annual report, considering all possible business disruptions, out‐migrations, loss of income and higher default rates, supply chain disruptions, changes in investor and consumer sentiments, strategic plans, associated risks, and impact on balance sheets, together with the advancement of mitigation measures for all things contained within such report.

By its terms, this bill seeks to require New York insurance companies to become an investigatory, reporting and enforcement agency of state government, for one of the most complex and dynamic areas of all of American society, namely “Climate Change”. A term which this legislation never defines, and leaves open to the broadest standard of interpretations.   It was reported from the Banks Committee to the Senate Insurance Committee on April 9, 2024. NYIA which is opposed to this legislation, issued a memo in opposition on this bill. It has no same as counterpart in the Assembly.

S6635 (Ramos) – This bill would make workers compensation awards to claimants for mental injury premised upon extraordinary work-related stress incurred at work. By its terms, this legislation would dramatically expand the class of employees who can file this type of claim, from simply police officers, firefighters, and EMTs, who have an extremely high stressed, public service profession, to now all employees, regardless of their type of work performed. It would further also transfer the burden of proof for such claims, onto the employer, thereby allowing work-related stress claims to be upheld, upon subjective allegations alone. Moreover, the term “extraordinary work stress” is left undefined, and amorphous by this bill, meaning that it would be very difficult to actually determine what “stress” is actually uniquely attributable to work, as compared to stress that is intertwined with the vagaries and vicissitudes of life, and intrinsically a part of the human condition.  NYIA, which is opposed to this legislation, issued a memo in opposition on this bill.  Its same as bill, A5745 (Reyes), has yet to be considered by the Assembly Labor Committee either last year or this year.

S6651 (Ramos) – This bill would include coverage of treatment rendered by a massage therapist, within claims for workers compensation. NYIA, which is opposed to this legislation, issued a memo in opposition on this bill.  This bill presently has no Assembly same as bill.

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Albany Update 04.03.24

In this issue …

DMV Preparing for Transition to OLV

Governor Kathy Hochul announced today that the New York State Department of Motor Vehicles (DMV) has launched a project to overhaul a significant portion of their aging technology systems. At the Insurance Industry Committee on Motor Vehicle Administration (IICMVA) conference, also held today, which NYIA participated in, DMV Deputy Commissioner Rebecca Wood indicated that an online verification (OLV) system is a component of this modernization project. While there is legislation needed, which is currently being considered as part of the New York State budget, DMV intends to move forward in preparation for the transition as a parallel track. DMV also acknowledged that implementation is going to be a multi-year effort. NYIA is continuing to advocate for the OLV legislation to be passed as part of the budget. Since the legislation was included in both the Governor’s executive budget and the Senate’s one house version of the budget, our efforts are now focused on the Assembly. We are thrilled to deliver this news to members about DMV’s intentions, are pleased our efforts to advance OLV are starting to come to fruition and will continue our advocacy in relation to the legislation.

DFS Proposes Photo Inspection Regulatory Amendment

Today the New York State Department of Financial Services (DFS) released a proposed amended auto inspection regulation, 11 NYCRR 67 (regulation 79), which outlines how an insurance company can waive inspections for all or some vehicles. The regulation is being amended in response to the law enacted last year to allow for optional photo inspections, a modernization initiative NYIA was instrumental in advancing. Additional information is in the Regulatory Activity – Insurance Law section of DFS’s website. NYIA is currently reviewing the formal proposed amendment, which follows a pre-proposed amendment DFS released last month. The proposal has a corresponding 60-day comment period that expires on Sunday, June 2, 2024. Comments can be submitted to Joana Lucashuk at joana.lucashuk@dfs.ny.gov. If your company has comments you would like NYIA to submit, please contact Bob Farley at bfarley@nyia.org by Friday, May 17.

DFS Proposes Group Capital Calculation Regulatory Amendment

DFS also a released a proposed third amendment to 11 NYCRR 82 (regulation 203), which pertains to Enterprise Risk Management and Own Risk Solvency Assessment; Group-Wide Supervision. The amendment is due to the group capital calculation (GCC) legislation advanced last year and relates to the GCC filing process, which indicates that the calculation shall be submitted electronically. The proposed regulation also details when an entity would be exempt from the filing, able to submit a limited group capital filing, needs to submit an annual GCC as well as provides parameters around “recognize and accept” for non-United States jurisdictions. Additional information is in the Regulatory Activity – Insurance Law section of DFS’s website. NYIA is currently reviewing the formal proposed amendment, which follows a pre-proposed amendment DFS released last month. The proposal has a corresponding 60-day comment period that expires on Sunday, June 2, 2024. Comments can be submitted to Joana Lucashuk at joana.lucashuk@dfs.ny.gov. If your company has comments you would like NYIA to submit, please contact Bob Farley at bfarley@nyia.org by Friday, May 17.

DMV Adopts RRG Regulatory Amendment

The New York State Department of Motor Vehicles (DMV) adopted a regulation today to amend parts 32.3(i), 34.2(k) and 34.8 of Title 15 NYCRR to expand the definition of what constitutes an insurance company to include certain risk retention groups (RRGs) with respect to automobile insurance. The adopted regulatory amendment, which takes effect immediately, is the same as what was originally proposed on January 17, 2024 (refer to page 3 of the document). The amendment is in response to a bill that was signed at the end of 2023, and a corresponding chapter amendment that was signed into law, S8053 (Webb)/A8505 (Kelles), which authorized RRGs to write auto insurance for certain nonprofit organizations.

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Albany Update 03.28.24

In this issue …

New York State Budget Update

While the deadline for adopting a budget is April 1, the Governor and Legislature have instead agreed to a short-term extender. Yesterday Governor Hochul issued a statement indicating that she will be delivering a bill to the Legislature to temporarily extend the budget deadline until Thursday, April 4. The Governor said that while she believes a final agreement is within reach the reason for the extension is so New Yorkers can enjoy the holiday weekend. Senate Majority Leader Andrea Stewart-Cousins stated in a news conference that “we’re in the middle of the middle.” The Senate and Assembly both passed the budget extender legislation today. We will keep NYIA members informed of any further updates on the budget.

Cyber Compliance Filing Deadline – April 15, 2024

As a reminder, the April 15 cyber compliance deadline is fast approaching. Covered entities need to file either a certification of material compliance or acknowledgement of noncompliance by this date. As we mentioned during the Information Security Advisory Group meeting held this week, delegates may go into the portal and sign on behalf of the highest ranking executive and the CISO with a “submitter” field being added. The highest ranking executive and the CISO themselves are required to have based their decision on documentation and data, and all related records and information must be retained regarding the submission for five years. Additional information is available in DFS’s Cybersecurity Resource Center by clicking on Submit a Compliance Filing on the left-hand menu.

Bills on the Move

The following bills have recently seen movement in at least one house of the Legislature.

• A6680 (Paulin) – Clarifies when telemarketing is prohibited during a state of emergency. Passed Assembly on 3/21/24. NYIA supports.
• A8831 (Berger) – Repeals section 3403 of the insurance law relating to anti-arson applications. Passed Assembly on 3/25/24. NYIA strongly supports as a priority initiative.
• A9407 (Weprin) – Amends current supplemental spousal liability opt-out requirements to only apply for personal auto insureds that indicate on an application that they have a spouse. Passed Assembly on 3/25/24. NYIA has not taken a position.
• S1471 (Breslin) – Permits an insurer to rescind or retroactively cancel an auto policy when it is purchased fraudulently. Passed Senate on 3/25/24. NYIA strongly supports.
• S1974A (Ramos) – Limits the ability for contracted pharmacy use in workers compensation. Passed the Senate on 3/20/24. NYIA opposes.
• S2796 (Breslin) – Repeals the requirement to obtain a declination from the MMIP before primary medical malpractice insurance can be placed in the excess line market. Passed Senate on 3/21/24. NYIA is neutral.
• S5916 (Hoylman-Sigal) – Removes the requirement of the filing of a notice of claim in an action under the adult survivors’ act. Reported from Judiciary Committee on 3/26/24. NYIA is seeking feedback from members.

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Albany Update 03.20.24

In this issue …

NYIA Submits Comments on DFS Proposed AI & ECDIS Circular Letter

The association submitted comments on DFS’s proposed circular letter on artificial intelligence and external consumer data information sources. NYIA raised a wide range of issues with the proposal, based on member feedback, with focus on the fact that circular letters are advisory only and need to refer to existing statute, corresponding regulations or case law. We received a tremendous amount of input and appreciate the robust comments shared by member companies. We will continue to monitor this issue closely and provide members with any updates regarding DFS’s intended next steps.

Analysis of Senate and Assembly Budget Proposals

As a follow up to our Albany Alert and report provided on the bi-weekly call last week, NYIA has put together an analysis of the Senate and Assembly budget proposals. This analysis provides the Senate and Assembly action on Executive Budget proposals as well as a list of new proposals from the Senate. We are weighing in with public policymakers on these proposals as budget negotiations heat up. It is uncertain whether there will be an on-time budget by the deadline of April 1. We will keep members informed.

Electronic Delivery Legislation Amended

The bill to allow for electronic delivery policy notices (including cancellations and nonrenewals) has been amended. The legislation, A8219A (Berger)/S2731A (Sanders) now applies to auto insurance. NYIA is working to have legislation introduced to allow for electronic delivery with workers compensation. The law was changed a couple years ago to allow for electronic delivery but chapter amendments were passed so it only applied to insurance law. The current efforts are to fully allow for electronic delivery with auto insurance and workers compensation insurance by including references in their corresponding laws.

Bills on the Move

Three bills were advanced from the Assembly Insurance Committee this week:

• A8831 (Berger) – Repeals the insurance law relating to anti-arson applications. The bill is currently in the Senate Insurance Committee. NYIA strongly supports as a priority initiative.
• A7910A (Weprin) – Limits insurance rating and underwriting pertaining to affordable housing. NYIA remains concerned with erosion of risk-based pricing. This legislation is similar to the language included in the Executive Budget. A major difference is the Assembly version is more expansive as far as what an insurance company would not be able to inquire about or use, including ownership of the building. There is currently no Senate companion but the language may be negotiated as part of the budget. NYIA is seeking feedback. Please contact Bob Farley at bfarley@nyia.org with any comments.
• A9407 (Weprin) – Modifies the supplemental spousal liability insurance law. The legislation is similar to the Executive Budget proposal. A major difference is that the Assembly’s version would have the opt out still apply at renewal and amendment. There is currently no Senate companion but the language may be negotiated as part of the budget. NYIA is seeking feedback. Please contact Cassandra Anderson at canderson@nyia.org with any comments.

One bill advanced from the Assembly Labor Committee:

• A1219A (Bronson) – Limits the ability for contracted pharmacy use in workers compensation. The bill is currently on the Senate Active List. NYIA opposes.

Four bills have recently passed in the Assembly, as has been the case in previous years:

• A4011 (Weprin) – Requires standardized definitions in insurance policies. The bill is currently in the Senate Insurance Committee. NYIA opposes.
• A2741 (Paulin) – Requires summaries of insurance policies including the limits, terms, amount of premium as well as deductibles. The bill is currently in the Senate Insurance Committee. NYIA opposes.
• A2866 (Pheffer Amato) – Establishes standards for windstorm deductible triggers. The bill is currently in the Senate Insurance Committee. NYIA opposes.
• A1731A (Dinowitz) – Restricts insurers from requesting personal, financial and tax information from insureds as a standard practice in processing ordinary theft claims. The bill is currently in the Senate Insurance Committee. NYIA opposes.

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Albany Update 03.12.24

In this issue …

NYIA Hosting Meeting on Cybersecurity Regulation Implementation

NYIA will be holding a meeting for members to discuss issues related to implementation of DFS’s amended cybersecurity regulation through the association’s Information Security Advisory Group. The meeting will be held virtually on Tuesday, March 26 from 2:00–3:00 p.m. You can add the meeting to your calendar. We encourage you to share this invitation with your company’s subject matter experts. Please contact Cassandra Anderson at canderson@nyia.org with any topics you would like raised. An agenda will be sent out closer to the meeting date.

DFS Releases Pre-Proposed Amended Regulation Related to Group Capital Calculation

The New York State Department of Financial Services (DFS) recently released a pre-proposed third amendment to 11 NYCRR 82 (regulation 203), which pertains to Enterprise Risk Management and Own Risk Solvency Assessment; Group-Wide Supervision. The amendment is due to the group capital calculation (GCC) legislation advanced last year and relates to the GCC filing process, which indicates that the calculation shall be submitted electronically. The pre-proposed regulation also details when an entity would be exempt from the filing, able to submit a limited group capital filing, needs to submit an annual GCC as well as provides parameters around “recognize and accept” for non-United States jurisdictions. Comments can be submitted to Joana Lucashuk by email at joana.lucashuk@dfs.ny.gov by Thursday, March 14. If you have comments you would like NYIA to submit on your behalf, please contact Bob Farley at bfarley@nyia.org by Wednesday, March 13.

DFS Announces Funds Provided to Consumers and Health Care Providers

DFS recently announced as part of National Consumer Protection Week that the agency in 2023 collected more than $182 million, with $158 million recovered for consumers and health care providers and $23 million in restitution from enforcement actions. In their media release DFS issued they continue to tout their consumer protection and enforcement roles and highlight how a consumer can file a complaint with the department.