-  This bill is not active in this session.
 

A07664 Summary:

BILL NOA07664
 
SAME ASSAME AS S03639
 
SPONSORStirpe
 
COSPNSR
 
MLTSPNSR
 
Amd §3105, Ins L
 
Requires persons having claims under a life insurance policy to provide reasonable assistance to the insurer in obtaining information relating to misrepresentations made by the insured.
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A07664 Actions:

BILL NOA07664
 
05/14/2019referred to insurance
06/05/2019reported referred to rules
06/17/2019reported
06/17/2019rules report cal.402
06/17/2019ordered to third reading rules cal.402
06/18/2019substituted by s3639
 S03639 AMEND= BRESLIN
 02/11/2019REFERRED TO INSURANCE
 05/13/20191ST REPORT CAL.665
 05/14/20192ND REPORT CAL.
 05/15/2019ADVANCED TO THIRD READING
 06/17/2019PASSED SENATE
 06/17/2019DELIVERED TO ASSEMBLY
 06/17/2019referred to insurance
 06/18/2019substituted for a7664
 06/18/2019ordered to third reading rules cal.402
 06/18/2019passed assembly
 06/18/2019returned to senate
 11/26/2019DELIVERED TO GOVERNOR
 12/06/2019VETOED MEMO.178
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A07664 Committee Votes:

INSURANCE Chair:Cahill DATE:06/05/2019AYE/NAY:24/0 Action: Favorable refer to committee Rules
CahillAyeGarbarinoAye
CookAyeHawleyAye
PretlowAyeBlankenbushAye
RiveraAyeFinchAye
CymbrowitzAyeRaiaAye
LavineAyePalmesanoAye
SteckAyeByrneAye
DilanAye
HunterAye
SimotasAye
WalkerAye
NiouAye
RosenthalAye
SternAye
McDonaldAye
RomeoAye
JacobsonAye

RULES Chair:Gottfried DATE:06/17/2019AYE/NAY:26/0 Action: Favorable
HeastieExcusedKolbAye
GottfriedAyeCrouchAye
LentolAyeFinchAye
GanttExcusedBarclayAye
NolanExcusedRaiaAye
WeinsteinAyeHawleyAye
OrtizAyeGiglioAye
PretlowAyeMalliotakisAye
CookAye
GlickAye
AubryAye
EnglebrightAye
DinowitzAye
ColtonAye
MagnarelliAye
PerryAye
PaulinAye
TitusExcused
Peoples-StokesAye
BenedettoAye
LavineExcused
LupardoAye
ZebrowskiAye

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A07664 Floor Votes:

There are no votes for this bill in this legislative session.
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A07664 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A7664
 
SPONSOR: Stirpe
  TITLE OF BILL: An act to amend the insurance law, in relation to representations by an insured   PURPOSE: This bill would clarify that the beneficiary or anyone claiming a right under a life insurance policy has a duty to cooperate with an insurer's investigation of a death occurring during the two-year contestability period.   SUMMARY OF PROVISIONS: Section one would amend Section 3105 of the Insurance Law to address a beneficiary or insured's obligation to assist the insurer in obtaining the necessary information to determine whether a misrepresentation was made by the applicant for insurance Section two establishes the effective date.   JUSTIFICATION: Section 3203 (a) (3) of the insurance law creates what is commonly referred to as the "two year contestability period." This section, which provides that a life insurance policy is incontestable by the insurer after it has been in force for two years following its date of issue, was created by the Legislature to ensure that insurers are able to protect against the payment of fraudulent claims by fully investigating claims that occur within the two year period following issuance of the policy. When an insured's death occurs during the two year period following the issuance of the policy, an insurer has the ability to investigate the insured's death to ensure that the applicant did not make any material misstatements on his or her application for life insurance that led the insurer to issue a policy that they would not have otherwise issued if the insured had not made the material misstate- ment on the application. If the life insurer, as a result of the inves- tigation of the claim, does not find evidence that there was any materi- al misrepresentation made on the application, the insurer will pay the claim in full. However, if the insurer finds evidence that the appli- cant made a mater ial misstatement on the application for life insuranc e the insurer is permitted, under current law, to take legal steps to return the premium paid to date and rescind the policy. An insurer's ability to fully investigate a claim during the two year period following issuance is a vital tool for insurers to detect fraud and prevent the payment of fraudulent claims. Often as part of the investigation to determine whether fraud has occurred, an insurer will need to review the medical records of the deceased insured and will request the beneficiary's assistance in obtaining information necessary to complete the investigation. The Department of Financial Services, however, in recent guidance, has stated that beneficiaries who are able to provide access to the information necessary for an insurer to complete an investigation, have no obligation to comply with the insur- er's request. This proposal amends Section 3105 of the Insurance Law to clarify that the beneficiary or anyone claiming a right under a life insurance policy has a duty to cooperate with an insurer's investigation of a death occurring during the two-year contestability period, and would require these individuals to assist in obtaining information related to an insurer's reasonable request for information, including a request for medical records, to enable an insurer to appropriately investigate a claim regarding a death occurring within the two-year contestability period. The ability to fully investigate a life insurance claim occurring within the two years following the date of issuance is of particular importance to life insurance companies who market and sell term life insurance policies to the middle market. Some of these policies are traditionally sold with limited medical underwriting, meaning that the insurer, in an effort to offer lower premium rates and avoid barriers to purchase, does not require full medical underwriting prior to issuance of the policy (e.g., does not require a full medical exam, bloodwork, etc. prior to issuance), but instead relies upon the truthfulness of an applicant's disclosures on their application for life insurance. If a beneficiary is able to refuse or block an insurer's reasonable request for information necessary for the insurer to complete au investigation following an insured's death during the two year contestability period, many carriers may face the difficult decision of whether they are able to continue to offer affordable and accessible products within the State.   LEGISLATIVE HISTORY: New Bill   FISCAL IMPLICATIONS: None.   EFFECTIVE DATE: This act shall take effect immediately.
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A07664 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          7664
 
                               2019-2020 Regular Sessions
 
                   IN ASSEMBLY
 
                                      May 14, 2019
                                       ___________
 
        Introduced by M. of A. STIRPE -- read once and referred to the Committee
          on Insurance
 
        AN  ACT to amend the insurance law, in relation to representations by an
          insured
 
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section  1.  Subsection  (a)  of  section 3105 of the insurance law is
     2  amended to read as follows:
     3    (a) (1) A representation is a statement as to past  or  present  fact,
     4  made to the insurer by, or by the authority of, the applicant for insur-
     5  ance  or  the prospective insured, at or before the making of the insur-
     6  ance contract as an inducement to the  making  thereof.  A  misrepresen-
     7  tation is a false representation, and the facts misrepresented are those
     8  facts which make the representation false.
     9    (2) Any person having or claiming a right under a life insurance poli-
    10  cy  that  (A)  provides  a death benefit and (B) has been in force fewer
    11  than two years following the date of issue or the date of  reinstatement
    12  if  evidence  of  insurability  is  requested,  shall provide reasonable
    13  assistance to the insurer in  obtaining  the  necessary  information  to
    14  determine  whether  a  misrepresentation  was  made by the applicant for
    15  insurance or the prospective insured.
    16    § 2. This act shall take effect immediately.
 
 
 
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD09812-01-9
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A07664 LFIN:

 NO LFIN
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A07664 Chamber Video/Transcript:

6-18-19Video (@ 03:53:24)Transcript pdf Transcript html
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