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Two Minutes With Tim - NY SHIELD Act - What Do Insurance Agencies Have To Do?

​New York enacted a cybersecurity law last year. What does that mean for insurance agents and brokers? If they're complying with the New York regulation on Cybersecurity Requirements for Financial Services Companies, not much. Just be prepared to notify the state attorney general if something goes seriously wrong. Watch:

 

Big I NY report, June 21, 2019

New York General Business Law Section 899-bb

Two Minutes With Tim: National Flood Program To Expire

​Here we go again. The National Flood Insurance Program is going to expire on Sept. 30, 2017 Dec. 22, 2017 Jan. 19, 2018 Feb. 8, 2018 March 23, 2018 July 31, 2018 Nov. 30, 2018.

Two Minutes With Tim: Expiration of the National Flood Insurance Program from Big I New York on Vimeo.

New York's Scaffolding Law Isn't Quite So Absolute

Not everyone working at an elevated height has a cause of action under New York's scaffolding law, according to an appellate court decision handed down on Tuesday:

Plaintiff house electrician was engaged in routine maintenance work when he fell from a ladder affixed to a scissor lift after fixing a light fixture (see Monaghan v 540 Inv. Land Co. LLC, 66 AD3d 605 [2009]). Indeed, plaintiff testified that he fixed light fixtures about twice weekly, that "nine out of ten times" the house electricians would change the whole fixture when performing such work, and that he retrieved sockets and bulbs from the building's storage area in order to perform his work. Further, his subforeman stated in an affidavit that the high-voltage nature of the lights caused the sockets to deteriorate, requiring them to be replaced on a regular basis, which necessitated keeping a large volume of sockets in stock on the premises. [*2]Accordingly, plaintiff's work clearly involved "replacing components that require replacement in the course of normal wear and tear" (Esposito v New York City Indus. Dev. Agency, 1 NY3d 526, 528 [2003]).

via courts.state.ny.us

Apparently, someone engaged in routine maintenance is not engaged in construction, at least within the meaning of New York Labor Law Section 240. We tend to think of the scaffolding law as being a black hole into which contractors fall and automatically become liable for hundreds of thousands of dollars. As this case illustrates, the law is a little more complex than that.

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Ask Tim, Episode #33: The New York Health Insurance Exchange

We go really high-tech with episode 33 of Ask Tim. We installed this fancy software called Skype in order to do a remote interview with IIABNY legislative representative Michael Barrett, who was comfortably ensconced in his office near the State Capitol. Yup, we're trend-setters here at IIABNY HQ.

Our conversation centered on the health insurance exchange that the Cuomo Administration is creating in order to comply with the federal Patient Protection and Affordable Care Act. We talked about:

• The technological preparations that are under way
• The potential roles for agents and brokers in governing the exchange
• What may happen over the next few months.

I conclude with a reminder about how IIABNY members may be able to use the exchange and potential tax benefits that may be worth investigating. Also, stay tuned for our upcoming new video series on health care reform.

Download Ask Tim Episode #33

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Suppl. Uninsured Motorist Coverage Bill Introduced in NYS Legislature

The following is the text of an email we received earlier this morning from our legislative office in Albany, concerning a bill that will change the way agents and brokers sell supplementary uninsured/underinsured motorist coverage. As you read this, please keep in mind that neither the Assembly nor the Senate has acted on it and everything in this message is subject to change. This is what we know so far. None of it is law yet, but some or all of it may become law in the near future.

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As we’ve previously advised, the leadership in both houses has been discussing legislation that would require all auto policies to have supplementary uninsured/underinsured motorists coverage, unless the policyholder rejects the coverage. We have  been part of these discussions over the last few weeks and raised the concerns that had been mentioned in response to our prior email to the committee. Today, a  SUM bill was introduced by the Insurance Chairs in both houses and is likely to be taken up before the end of session. It is a better version than the original bill, which had numerous problems that would have made administration difficult.  In addition to providing for SUM coverage on all policies, the bill also includes a no-fault fraud component,  that we had encouraged the Senate to include as part of the negotiations. Here’s a summary of what the bill provides:

Any auto policy would have Supplementary uninsured/underinsured motorists insurance in the same amount as the bodily injury liability limits on the policy, unless the insured rejects coverage. The rejection of coverage must be memorialized through a signed writing, audio recording, electronic signature or any other means evidencing the insured’s rejection of coverage.

If the rejection or selection of lower SUM coverage is in written or electronic form, then it must be done on a form provided to the insured at the time the policy is sold, purchased, and/or negotiated. The form must fully advise the insured of the nature of the coverage and stat that the coverage is equal to BI limits unless lower limits are requested or the coverage is rejected. The form must be in 12-point bold type and contain a prescribed statement regarding SUM coverage.

If the rejection or selection of lower limits is made verbally, a memorialization in writing or electronic signature may be received by the insurer after to the sale, purchase and/or negotiation of the policy.

If the rejected or selection of lower limits is made verbally, the insurer or their agent shall read the identical or substantially similar language as is prescribed on the form and confirm the client has heard and understood it, and restate it as often as is necessary until the insured has verbally confirmed that they fully understand it.

Insurers must notify policyholders at the time of or within 60 days of each renewal of his or her options regarding SUM coverage pursuant to regulations that may be issued by the Superintendent. Receipt of this annual notice will not constitute an affirmative waiver of the insured’s right to coverage where the insured has not signed a selection or rejection form.

In addition to providing for SUM coverage, the bill also includes a component to address no-fault fraud.

Providers of durable medical equipment who have engaged in fraudulent practices can be prohibited from seeking no-fault payments. This provision is very similar to the law and implementing regulations that allow insurers to refuse payments to medical providers that have engaged in fraudulent practices.

The bill would allow the Superintendent to prohibit a provider of durable medical equipment from demanding or requesting payment under this article for DME for a period to be determined by the superintendent if he determines after notice and a hearing that the provider: 

1. Has engaged in a pattern or practice of fraudulent, excessive or unlawful billing for DME;
2. Has engaged in a pattern or practice of bill for DME that was not provided or that was not necessary;
3. Has committed a fraudulent insurance act;
4. Has been convicted of a crime involving fraudulent or dishonest practices;
5. Has refused to appear before, or answer any questions upon request of the Superintendent or of any authorized officer of the state or refused to produce any relevant information concerning the conduct of the provider DME; or
6. Has violated any provision of the no-fault law or regulations.

The superintendent must maintain a list of DME providers that have been prohibited from seeking payment and make the information available to the public.

The provisions of the law would take effect 180 days after it becomes law and would apply to policies issued, entered into or renewed on and after such date.

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Ask Tim, Episode #23 -- Commercial Lines Modernization

The latest episode of Ask Tim looks at the new almost-law that allows insurance carriers to write more policies in the so-called Free Trade Zone. I say "almost-law" because, while it has passed both chambers of the New York State Legislature, Gov. Cuomo has not yet signed it, though all indications are that he will.

Summary:

• Carriers can write policies free from rate and form filing approval requirements for "large commercial insureds".
• A large commercial insured generates at least $25,000 in annual commercial insurance premium, employs or retains a "special risk manager," and meets at least one of the following criteria:
  • Net worth of $7.5 million or more
  • Net worth of $1.5 million or more and gross assets of more than $10 million
  • For-profit business with net worth of at least $1.5 million and annual gross revenues of more than $15 million
  • For-profit business with annual gross revenues of more than $15 million and gross assets of more than $10 million
  • Not-for-profit or public entity with an annual budget of more than $20 million
  • Municipality with a population of at least 50,000
  • Has at least 50 employees or 100 employees within the corporate structure
• The special risk manager must be a licensed producer who meets specfic educational and experience criteria.
• Carriers must make informational filings, and the law contains other consumer protections.
• The law expires on June 30, 2013.

More information:

• The complete text of the bill
• Capitol Report, June 30, 2011

 

Download Ask Tim Episode #23

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Mich. Congresswoman: Get the Government Out of the Flood Ins. Business

I have serious reservations about this proposal. While it is always a good thing to review and evaluate how any government program is working, looking at in isolation is not. The National Flood Insurane Program has many problems, but what is the alternative? Are private insurers clamoring for the chance to write flood coverage? If they are, no IIABNY members have told me about it.

According to another article, Rep. Miller asked rhetorically, "What in the world is the federal government doing in the flood insurance business?" The answer to that question, of course, is that private insurers found the flood insurance business to be a losing proposition. Congress created the NFIP in the 1960's to fill the void left by private insurers who were losing their collective shirts in it. Have market conditions changed since then to the point where property owners no longer need a government program? I will be curious to hear testimony on that question if and when the relevant congressional committee holds hearings on this bill.

Rep. Miller has done us a favor by opening the debate. She's laid down her cards -- the NFIP should go. Let's have an open, intelligent discussion about how this country should protect property owners from the risk of flood loss.

As always, I'd like to hear your thoughts on this bill and the flood insurance situation in general. So, flood me with your opinions ("flood me" -- get it?) in the comments.

 

Legislation Introduced To Phase Out NFIP

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February 8, 2011 By Arthur D. Postal, PropertyCasualty360.com

The legislation to phase out the National Flood Insurance Program, H.R. 435, was introduced by Rep. Candice Miller, R-Mich. (File Photo: AP)

NU Online News Service, Feb. 8, 3:10 p.m. EST

WASHINGTON—Legislation has been introduced in Congress that would phase out the National Flood Insurance Program by the end of 2013.

The legislation, H.R. 435, was introduced by Rep. Candice Miller, R-Mich.

The bill would also immediately end all remapping of the program mandated by prior reauthorizations of the program, thereby ending the agency’s authority to charge more to current customers based on new maps mandated by the 2003 law that remains in effect.

Earlier this month, Rep. Miller had asked colleagues to support the measure.

That Congress may take a long look at the program was also acknowledged earlier this week by Rep. Scott Garrett, R-N.J., chairman of the Capital Markets Subcommittee of the House Financial Services Committee, which has prime jurisdiction over the program.

During an appearance at a housing conference Monday, Rep. Garrett said, “The government's history in pricing risk is extremely poor,” citing the Federal Deposit Insurance Corporation, the National Flood Insurance Program, and the Pension Benefit Guaranty Corp. as three entities with “terrible records of properly pricing for risk.”

The current program expires Sept. 30, the end of the current fiscal year. The program has been extended five times, with several lapses, since the origin

via www.propertycasualty360.com

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A Look At Insurance Bills in the NYS Legislature

It's not all glamour being IIABNY's resident InsuranceGeek^®. I know what you're thinking -- "Tim, you have the geek cave, the Flip Cam, the freedom to travel to the Indy 500, Hogwarts Castle, and the beach." Well, yes, but -- leaving aside the association's failure to date to honor my rather modest job perk requests (50 pound boxes of peanut M&M's; bottled Alpine spring water with expiration dates no sooner than December 31, 2012; and a Swedish masseuse named Helga) -- still, there are times when even I must engage in tasks that are somewhat less than intellectually challenging. In the vernacular: Grunt work.

One of these tasks is updating the Insurance Legislation pages on the IIABNY Web site. When our legislative representatives (Michael Barrett, Jill Muratori and Peter Carr) send us the raw file for the Capitol Report, they include a list of insurance-related bills recently introduced in the New York State Legislature. I take that information and enter it on the legislation pages on our Web site so that members can peruse the list and get more information about any particular bills that interest them. When a bill gets introduced, I normally put it for one week on the list of new bills, then move it to its appropriate category (auto, life and health, workers' comp, etc.) afterword.

If you click the link in the last paragraph, you will find no bills listed as having been recently introduced. That is because the latest Capitol Report had a list of bills that went on for eight pages. Eight frackin' pages. If there's one thing our representatives in Albany really enjoy, it's introducing legislation. I decided, in the interest of keeping the list of new bills reasonable, to just skip that step and put all the new introductions on their appropriate pages. I'm not done yet, but I'm more than halfway finished.

This blog post actually has a point, and it's not about how oppressive my workload is. Rather, as I was updating these pages, the interesting ideas our representatives have for state laws jumped out at me, and I thought you might find some of the proposals 1) interesting; 2) terrifying; 3) laughable. Bear in mind that thousands of bills get introduced each year but only a few even make it out of committee, let alone gain passage from both legislative chambers and the governor's signature. So don't barricade the doors as you read some of these. This is just a sample of what at least some members of the Assembly and Senate would like to do:

• Reduces a retired or disabled owner's no fault insurance premium by providing appropriate automobile insurance rates to reflect a reduced exposure to loss due to situations where drivers either have no wages to lose or are covered for lost wages by another first payer insurance policy. (Bill numbers A.530, S.803, Assemblyman Thiele, Senator LaValle)
• Prohibits the inclusion of any advertisement or other information in any mailing sent by the department of motor vehicles. (A.617, Assem. Sayward)
• Provides that an insurer may not hold nor acquire interest in a motor vehicle repair shop. (A.960, Assem. Destito)
• Requires motor vehicle repair shops to provide written notice to customers that an insurance company cannot require a person to use a specific repair shop. (A.1192, Assem. Gantt)
• Provides that reduction in auto insurance premium for insured who completes defensive driving course shall not be less than fifteen percent. (A.1236, Assem. Colton)
• Provides that motor vehicles manufactured after December 31, 2011 and operated in New York state shall be equipped with an event data recorder. (A.1870, Assem. Jeffries)
• Relates to prohibiting rate variations of over ten percent between counties within the city of New York for non-business private passenger automobiles. (S.1344, Sen. Dilan)
• Provides for the revocation of insurers license, and prohibits the sale of new policies where insurer cancels or fails to renew two percent or more of home owner policies in high risk areas, including coastal areas. (S.1118, Sen. Parker)
• Provides that the maximum deductible allowed in catastrophic windstorms shall not be greater than fifteen hundred dollars and shall be stated in the policy in numerical terms; also provides that deductibles shall only be applicable to losses incurred in windstorms with speeds greater than 125 miles per hour. (A.1413, S.1460, Assem. Thiele, Sen. Lavalle)
• Requires notice of cancellation or non-renewal of property/casualty insurance policies to be sent by an insurer to an insured by registered or certified mail, return receipt requested. (S.833, Stavisky)
• Requires insurers to provide certificate holders with at least thirty days prior written notice of termination of group health insurance coverage. (A.2006, S.1167, Assem. Weprin, Sen. Parker)

That's just a smattering of the bills lawmakers have introduced. Probably very few of them will become law. What are your thoughts on these or some of the others you see listed on our Web site? Let me know in the comments.

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Only 734 More Days Until the Next Election...

Gee, wasn't that fun?

The election is over. No more TV adds accusing a candidate of being a corrupt, adulterous scumbag who doesn't floss regularly and who does lines of coke every morning as soon as he's done raising your taxes. Watching TV just won't be the same; it will be...enjoyable.

Now that New York has a new governor and a lot of the same legislators, what happens to the independent insurance agents' agenda? Sure the state's looking at another gigantic budget deficit, a problem that David Paterson will cheerfully hand off to Andrew Cuomo on January 1. While our issues may be secondary in terms of the attention lawmakers give them, they are no less important. No fault insurance remains a gold mine for organized crime. The 2007 workers' compensation reforms are still not fully implemented. We still don't know what workers' comp coverage obligations, if any, an out-of-state employer has for employees who visit the state on business. The homeowners market in eastern Long Island remains tough on its best days. The scaffolding law is still driving up liability insurance rates. It's very possible (maybe even likely) that the IIABNY/CIBGNY legal action against the New York Insurance Department will be unresolved when the new administration takes office. And those are just the problems I can think of off the top of my head.

Campaigning for elective office is ugly, but governing can be even uglier. The saying goes that to govern is to choose. When politicians choose, they tend to make at least some of the citizenry rather angry. You may have noticed that during the just-concluded election season. New York State legislators and the governor are almost guaranteed to make just about everyone angry about something; a $9 billion budget deficit makes that inevitable. So yes, governing for the next two years will be ugly. In the midst of the ugliness, I hope lawmakers will give some attention to some very serious insurance issues. Agent participation at IIABNY's Capital Event in February will be essential to raising awareness of these problems. Mark your calendars now.

And if you're really suffering from the day-after-Election-Day blues, just remember that November 6, 2012 is only 734 days away. Don't shoot the messenger.

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Health Care Reform 101

Health reform's complicated - but it can be easily explained. The good folks at the Kaiser Family Foundation have produced a terrific video - that's entertaining to boot - laying out pros and cons, explaining the rationale behind and opposition to reform, and all from a neutral perspective.

via www.joepaduda.com

This post from Joe Paduda's Managed Care Matters blog lists several excellent resources for those of you trying to understand the Patient Protection and Affordable Care Act (aka health care reform.) I especially recommend the Kaiser Family Foundation's video. It's about 9 minutes long, illustrates the various features of the law, and points out the arguments of those on both sides of the debate. It's a good educational tool for both clients and insurance professionals trying to get a handle on the changes we'll see over the next several years.

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