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Enacted Law Bulletin 01.30.24

The following bills have been enacted into law this session after being signed by Governor Hochul. Should you have any questions regarding these bills, please contact NYIA’s General Counsel, Bob Farley at (518) 986-2037 or bfarley@nyia.org.

A8518 (Stern)/S8004 (Skoufis)

AN ACT to amend the insurance law, in relation to standards for prompt investigation and settlement of claims; and to amend a chapter of the laws of 2023 amending the insurance law relating to standards for prompt investigation and settlement of claims arising from states of emergency, as proposed in legislative bills numbers S5201 and A2078, in relation to the effectiveness thereof. 

This bill would enact a chapter amendment to last session’s bill A2078/S5201 relating to prompt claim settlements during states of emergency.

More specifically, this chapter amendment would amend section 2618 of the insurance law, to provide a new, and more narrow definition for what would constitute an emergency that would trigger the prompt settlement of claims required under the original bill.  Under this revised definition, such emergency could only now include:

• A local state of emergency pursuant to section twenty-four of the executive law,
  • when the governor declares a disaster emergency pursuant to section 28 of the executive law, or
  • when the President issues a major disaster or emergency declaration pursuant to the Robert T. Stafford Disaster Relief and Emergency Assistance Act;
• A “natural disaster” defined as the occurrence of widespread catastrophic or severe damage, injury, or loss of life or property resulting from any natural cause, including fire, flood, earthquake, hurricane, tornado, high water, landslide, mudslide, wind, storm, wave action, and ice storm; or
• A disaster caused by an act of terrorism; and
• The claims seeking to be settled are a result of the disasters listed above.

This chapter amendment would further provide that the time settlement time frame would now commence within 15 days of receipt of a properly executed proof of loss and receipt of all items, statements and forms requested.

By its provisions, this chapter amendment would further exempt commercial claims from these artificial 15 day time frames, and provide that if the insurer needs more time to determine whether the non-commercial claim should be accepted or rejected because the insurer is prohibited from accessing the property to investigate the claim, that such insurer shall be granted one additional extension of 15 days.

Lastly, this chapter amendment would additionally provide, that if the insurer needs more time to be able to physically access the property, they must notify the claimant, or the claimant’s authorized representative, every 15 business days, in writing, setting forth the reasons why such additional time is needed for the investigation.  When the insurer is no longer prohibited from accessing the property, and the property can be accessed, then the insurer shall have no more than 15 days to adjudicate the claim.

This bill took effect on January 26, 2024.

A8505 (Kelles)/S8053 (Webb)

AN ACT to amend the vehicle and traffic law, in relation to owner’s policies of liability insurance issued by a risk retention group not chartered within this state; and to amend a chapter of the laws of 2023 amending the insurance law and the vehicle and traffic law relating to owner’s policies of liability  insurance issued by a risk retention group not chartered within this state, as proposed in legislative bills numbers S5959B and A5718B, in relation to a study and reporting on the impact of such bill, required  reporting by certain risk retention groups of examinations, audits, or other investigations, performed by another state’s insurance commissioner and the effectiveness thereof. 

This bill would enact a chapter amendment to last session’s bill A5718B/S5959B which authorized federally authorized risk retention groups (RRGs) to write coverage for automobile insurance for certain not-for-profit entities.

More specifically, this chapter amendment would amend section 311 of the vehicle and traffic law to clarify that coverage issued by the RRG must be for a vehicle registered to a not-for-profit organization that is tax-exempt under section 501(c)(3) of the federal internal revenue code.

It would further limit such writing only to vehicles that do not have a seating capacity of more than 15 passengers, are not limousines or luxury limousines, and are not used solely for personal use by a director, officer, authorized person, or key person, of the not-for-profit, or their relatives or related parties.

Lastly, this chapter amendment would require the superintendent of the Department of Financial Services in consultation with the commissioner of motor vehicles, to conduct a study on the impact of this act to determine the efficacy of risk retention groups not chartered in this state in issuing vehicle insurance policies.  Such study must report its findings and recommendations to the governor and the legislature no later than September 1, 2027.

This bill will take effect on March 1, 2024.