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A04024 Summary:

BILL NOA04024
 
SAME ASSAME AS S01595
 
SPONSORPretlow
 
COSPNSR
 
MLTSPNSR
 
Add 3242, amd 4224, Ins L
 
Relates to authorizing non-insurance benefits or services to be offered as part of group life or group or blanket accident or health insurance policies.
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A04024 Actions:

BILL NOA04024
 
01/30/2017referred to insurance
01/03/2018referred to insurance
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A04024 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A4024
 
SPONSOR: Pretlow
  TITLE OF BILL: An act to amend the insurance law, in relation to authorizing non-insurance benefits or services to be offered as part of a group life or group or blanket accident and health insurance policy   PURPOSE: This bill will add a new § 3242 to the Insurance Law to expressly permit life insurers to include as part of a group life or group or blanket accident and health insurance policy certain non-insurance benefits such as: financial and estate planning services; financial counseling for beneficiaries; travel assistance services; grief counseling services' funeral planning services; and identity theft services   SUMMARY OF PROVISIONS: This bill will add a new § 3242 to the Insurance Law to expressly permit life insurers to include as part of a group life or accident & health insurance contract certain non-insurance benefits or services, as expressly provided or any other benefit or service approved by the Superintendent. This bill also creates an exception to § 4224 of the Insurance Law for circumstances where the non-insurance benefits are permitted under § 3242 of the Insurance Law.   JUSTIFICATION: Section 4224 of the Insurance Law prohibits insurers and their producers from so-called "rebating" where something of value is offered for no charge for the purpose of inducing the purchase of a product. Although this law was intended to prevent, for instance, insurance producers from offering merchandise or prizes as an inducement to purchase an insurance policy, it has been much more broadly interpreted and applied by state insurance regulators during the policy form filing review process. This broad interpretation of this section of law has had implications for insurers which have attempted to have policy form filings approved that proposed to include certain types of non-insurance benefits and services, as outlined above, that are routinely offered free of charge as part of group insurance policies in other states. If enacted, this bill would expressly permit insurance customers in New York to benefit from these types of non-insurance benefits & service that are expressly authorized in the bill and are routinely provided to such group customers/employees in other states. It also authorizes the Superintendent of Financial Services to approve any other such benefit or services that he or she deems appropriate going forward In addition to providing express authorization for these types of benefits & services, this bill will also provide a specific exemption from § 4224 of the Insurance Law so that it is clear that these types of benefits and services are not considered to be a rebate. Enactment of this bill will facilitate life insurers to provide New York employers and employees who are purchasing group life or accident & health insurance coverage with these additional benefits for no charge and will afford them with the opportunity to take advantage of the services, similarly to employees in other states.   LEGISLATIVE HISTORY: 05/20/15 A7609 referred to insurance 01/06/16 A7069 referred to insurance   FISCAL IMPLICATIONS: None   EFFECTIVE DATE: Immediately.
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A04024 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          4024
 
                               2017-2018 Regular Sessions
 
                   IN ASSEMBLY
 
                                    January 30, 2017
                                       ___________
 
        Introduced  by M. of A. PRETLOW -- read once and referred to the Commit-
          tee on Insurance
 
        AN ACT to amend the insurance law, in relation to authorizing  non-insu-
          rance  benefits  or  services to be offered as part of a group life or
          group or blanket accident and health insurance policy

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section  1.  The insurance law is amended by adding a new section 3242
     2  to read as follows:
     3    § 3242. Non-insurance benefits and services as part  of  a  policy  or
     4  certificate of group life or group or blanket accident and health insur-
     5  ance.   (a) An insurer licensed to write life insurance and accident and
     6  health insurance may include certain non-insurance benefits or  services
     7  in  conjunction  with its issuance of a group life insurance or group or
     8  blanket accident and health insurance policy. If included, such  non-in-
     9  surance  benefits or services shall be made available to similarly-situ-
    10  ated members of the group.  Any non-insurance benefits or services  made
    11  available  under  the  policy  shall  be set forth in the policy and the
    12  certificate.
    13    (b) Non-insurance benefits and services permitted under  this  section
    14  shall include, but not be limited to, the following:
    15    (1) financial and estate planning services;
    16    (2) financial counseling for beneficiaries;
    17    (3) travel assistance services;
    18    (4) grief counseling services;
    19    (5) funeral planning services;
    20    (6) identity theft services; and
    21    (7)  any  other  benefit or service that may be approved by the super-
    22  intendent.
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD04796-01-7

        A. 4024                             2
 
     1    (c) Any entity providing non-insurance benefits or services  permitted
     2  under  this section must be appropriately licensed to provide such bene-
     3  fits or services.
     4    (d)  The  superintendent may adopt rules to regulate the disclosure in
     5  the policy and certificate related  to  the  non-insurance  benefits  or
     6  services permitted under this section and included in the policy.
     7    §  2.  Subsection (c) of section 4224 of the insurance law, as amended
     8  by chapter 496 of the laws of 2013, is amended to read as follows:
     9    (c) Except as permitted by section three thousand two hundred  thirty-
    10  nine  or  three  thousand  two  hundred  forty-two  of  this  chapter or
    11  subsection (f) of this section, no such life insurance  company  and  no
    12  such  savings  and  insurance  bank  and no officer, agent, solicitor or
    13  representative thereof and no such insurer doing in this state the busi-
    14  ness of accident and health insurance and no officer,  agent,  solicitor
    15  or  representative  thereof,  and  no  licensed  insurance broker and no
    16  employee or other representative of any such insurer, agent  or  broker,
    17  shall  pay,  allow  or give, or offer to pay, allow or give, directly or
    18  indirectly, as an inducement to any person to  insure,  or  shall  give,
    19  sell  or  purchase,  or offer to give, sell or purchase, as such induce-
    20  ment, or interdependent with any policy of  life  insurance  or  annuity
    21  contract  or policy of accident and health insurance, any stocks, bonds,
    22  or other securities, or any dividends or profits accruing or  to  accrue
    23  thereon, or any valuable consideration or inducement whatever not speci-
    24  fied  in  such policy or contract other than any valuable consideration,
    25  including but not limited to merchandise  or  periodical  subscriptions,
    26  not exceeding twenty-five dollars in value; nor shall any person in this
    27  state  knowingly  receive  as  such inducement, any rebate of premium or
    28  policy fee or any special favor or advantage in the dividends  or  other
    29  benefits  to accrue on any such policy or contract, or knowingly receive
    30  any paid employment or contract for services of any kind, or  any  valu-
    31  able consideration or inducement whatever which is not specified in such
    32  policy or contract.
    33    § 3. This act shall take effect immediately.
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