A08698 Summary:
BILL NO | A08698 |
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SAME AS | SAME AS S07768 |
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SPONSOR | Hunter |
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COSPNSR | |
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MLTSPNSR | |
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Amd 3426, Ins L (as proposed in S.4326 & A.5379) | |
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Provides for a policy term of less than one year where an insured requests such a policy from an insurer offering such a policy; requires that the insurer shall offer additional information regarding such policy. |
A08698 Actions:
BILL NO | A08698 | |||||||||||||||||||||||||||||||||||||||||||||||||
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01/10/2022 | referred to insurance | |||||||||||||||||||||||||||||||||||||||||||||||||
01/20/2022 | reported | |||||||||||||||||||||||||||||||||||||||||||||||||
01/20/2022 | advanced to third reading cal.302 | |||||||||||||||||||||||||||||||||||||||||||||||||
01/25/2022 | passed assembly | |||||||||||||||||||||||||||||||||||||||||||||||||
01/25/2022 | delivered to senate | |||||||||||||||||||||||||||||||||||||||||||||||||
01/25/2022 | REFERRED TO RULES | |||||||||||||||||||||||||||||||||||||||||||||||||
01/25/2022 | SUBSTITUTED FOR S7768 | |||||||||||||||||||||||||||||||||||||||||||||||||
01/25/2022 | 3RD READING CAL.141 | |||||||||||||||||||||||||||||||||||||||||||||||||
01/25/2022 | PASSED SENATE | |||||||||||||||||||||||||||||||||||||||||||||||||
01/25/2022 | RETURNED TO ASSEMBLY | |||||||||||||||||||||||||||||||||||||||||||||||||
02/24/2022 | delivered to governor | |||||||||||||||||||||||||||||||||||||||||||||||||
02/24/2022 | signed chap.23 |
A08698 Committee Votes:
Cahill | Aye | Blankenbush | Aye | ||||||
Cook | Aye | Hawley | Aye | ||||||
Pretlow | Aye | Byrne | Aye | ||||||
Rivera | Aye | Schmitt | Aye | ||||||
Cymbrowitz | Aye | Palmesano | Aye | ||||||
Lavine | Aye | DiPietro | Aye | ||||||
Steck | Aye | Gandolfo | Aye | ||||||
Dilan | Aye | ||||||||
Hunter | Aye | ||||||||
Niou | Aye | ||||||||
Rosenthal | Aye | ||||||||
Stern | Aye | ||||||||
McDonald | Aye | ||||||||
Jacobson | Aye | ||||||||
Williams | Aye | ||||||||
Meeks | Aye | ||||||||
Forrest | Aye | ||||||||
Anderson | Aye | ||||||||
Go to top
A08698 Floor Votes:
Yes
Abbate
Yes
Colton
Yes
Gallagher
Yes
Lawler
Yes
Perry
Yes
Smullen
Yes
Abinanti
Yes
Conrad
Yes
Gallahan
Yes
Lemondes
Yes
Pheffer Amato
Yes
Solages
Yes
Anderson
Yes
Cook
Yes
Gandolfo
Yes
Lunsford
Yes
Pretlow
Yes
Steck
Yes
Angelino
Yes
Cruz
Yes
Giglio JA
Yes
Lupardo
ER
Quart
Yes
Stern
Yes
Ashby
Yes
Cusick
Yes
Giglio JM
Yes
Magnarelli
Yes
Ra
Yes
Stirpe
Yes
Aubry
Yes
Cymbrowitz
Yes
Glick
Yes
Mamdani
Yes
Rajkumar
Yes
Tague
Yes
Barclay
Yes
Darling
Yes
Gonzalez-Rojas
Yes
Manktelow
Yes
Ramos
Yes
Tannousis
Yes
Barnwell
Yes
Davila
Yes
Goodell
Yes
McDonald
Yes
Reilly
Yes
Tapia
Yes
Barrett
Yes
DeStefano
Yes
Gottfried
Yes
McDonough
Yes
Reyes
Yes
Taylor
ER
Benedetto
Yes
Dickens
Yes
Griffin
Yes
McMahon
Yes
Richardson
Yes
Thiele
Yes
Bichotte Hermel
Yes
Dilan
Yes
Gunther
Yes
Meeks
Yes
Rivera J
Yes
Vanel
Yes
Blankenbush
Yes
Dinowitz
Yes
Hawley
Yes
Mikulin
Yes
Rivera JD
Yes
Walczyk
Yes
Brabenec
Yes
DiPietro
Yes
Hevesi
Yes
Miller B
Yes
Rosenthal D
Yes
Walker
Yes
Braunstein
Yes
Durso
Yes
Hunter
Yes
Miller M
Yes
Rosenthal L
Yes
Wallace
Yes
Bronson
Yes
Eichenstein
Yes
Hyndman
Yes
Mitaynes
Yes
Rozic
Yes
Walsh
Yes
Brown
Yes
Englebright
Yes
Jackson
Yes
Montesano
Yes
Salka
Yes
Weinstein
Yes
Burdick
Yes
Epstein
Yes
Jacobson
Yes
Morinello
Yes
Santabarbara
Yes
Weprin
Yes
Burgos
Yes
Fahy
Yes
Jean-Pierre
Yes
Niou
Yes
Sayegh
Yes
Williams
Yes
Burke
Yes
Fall
Yes
Jensen
ER
Nolan
Yes
Schmitt
Yes
Woerner
Yes
Buttenschon
Yes
Fernandez
Yes
Jones
Yes
Norris
Yes
Seawright
Yes
Zebrowski
Yes
Byrne
Yes
Fitzpatrick
Yes
Joyner
Yes
O'Donnell
Yes
Septimo
Yes
Zinerman
Yes
Byrnes
Yes
Forrest
Yes
Kelles
Yes
Otis
Yes
Sillitti
Yes
Mr. Speaker
Yes
Cahill
Yes
Friend
Yes
Kim
Yes
Palmesano
Yes
Simon
Yes
Carroll
ER
Frontus
Yes
Lalor
Yes
Paulin
Yes
Simpson
Yes
Clark
Yes
Galef
Yes
Lavine
Yes
Peoples-Stokes
Yes
Smith
‡ Indicates voting via videoconference
A08698 Memo:
Go to topNEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)   BILL NUMBER: A8698 SPONSOR: Hunter
  TITLE OF BILL: An act to amend the insurance law, in relation to providing for a policy term of less than one year in certain situations   PURPOSE: The purpose of this bill is to make clarifying changes to Chapter 679 of the Laws of 2021 to allow for liability insurance policies of less than one year, provided that the insurer also offers the insured the option of purchasing a policy with a term of one year and adheres to other requirements to ensure that such policy is actuarially sound and that the insured is appropriately notified.   SUMMARY OF PROVISIONS: Section 1, subparagraph (E) of the bill provides that an insurer may offer a liability insurance policy with a term of less than one year, provided that the insurer also offers the insured the option of purchas- ing a policy with a term of one year, and: the policy is written on an occurrence basis; and the policy is written on a defense cost outside limits basis. Section 1, subparagraph (E) provides that the insurer may extend the policy provided: that the coverage remains in effect at the same terms and conditions; the rate accords with the rates filed with DFS at the policy's inception; the policy extension does not result in the policy period exceeding 11 months in total; the policy has no annual aggregate liability limit but may have aggregate limits for the term of the poli- cy; the policy does not provide medical malpractice coverage or liabil- ity insurance as required by Articles 6, 8, or 44-B of the Vehicle and Traffic Law or under any other financial responsibility law, or public entity insurance; the policy provides for a term of at least one month; the policy does not contain a clause limiting the timely filing of a claim; the policy provides for a return of premium on a pro-rata basis if the insured cancels or otherwise terminates the policy before the policy's expiration; and the insurer provides a written disclosure to the insured that explains that a policy issued pursuant to this subpara- graph may be more expensive than a policy with a term of one year. Section 2 makes technical changes. Section 3 is the effective date.   JUSTIFICATION: Insurance Law Section 3426 was enacted in the 1986 to address a crisis in the commercial liability insurance market. All types of businesses and public entities were having difficulty finding affordable liability insurance. To address the problem, the Legislature enacted comprehensive reforms that provided stability, security, and certainty to policyholders, including restrictions on policy cancellation and non-renewals and premium increases. While the commercial liability insurance market today is much healthier, most of the reforms enacted in Section 3426 still provide legitimate policyholder protections that remain relevant and important today--with a notable exception. Section 3426(d) (2) prohibits insurers from issuing a policy with a term of Less than one year. While this requirement was well intended 34 years ago, today it is hurting small businesses by denying them the ability to obtain coverage that meets their unique and changing needs. Many small businesses operate in a very different manner today and do not want or need a one-year policy. The nature of work is changing and in today's "gig" economy, all different types of businesses engage in part-time, temporary, or freelance work, so they do not need continuous coverage for a whole year. They need insurance for when they are engaged in a job, which may be for few days, a few weeks, or even a few hours. Unfortunately, businesses cannot get this type of "on-demand" insurance for shorter terms in New York. New York is the only state that prohibits short-term insurance policies. This means businesses will either forgo obtaining insurance or will have to pay more for insurance they don't need. The COVID-19 pandemic has highlighted the importance for small busi- nesses to be able to purchase polices for shorter terms based on their needs. Many small businesses have struggled to remain in business during the COVID shutdown. Those that have started to operate again often do so on a part-time basis, and they still face an uncertain future. They must have the ability to customize their insurance and control their costs or they risk going out of business. This bill would give small businesses that ability. Any policyholder that still wanted a one-year policy will still be able to obtain it. This bill simply provides more choices for an insured.   LEGISLATIVE HISTORY: New bill.   FISCAL IMPLICATIONS: None.   EFFECTIVE DATE: This act shall take effect on the same date and in the same manner as. Chapter 679 of the Laws of 2021 (30 days succeeding enactment).
A08698 Text:
Go to top STATE OF NEW YORK ________________________________________________________________________ 8698 IN ASSEMBLY January 10, 2022 ___________ Introduced by M. of A. HUNTER -- read once and referred to the Committee on Insurance AN ACT to amend the insurance law, in relation to providing for a policy term of less than one year in certain situations The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Subparagraph (E) of paragraph 2 of subsection (d) of 2 section 3426 of the insurance law, as added by a chapter of the laws of 3 2021 amending the insurance law relating to providing for a policy term 4 of less than one year in certain situations, as proposed in legislative 5 bills numbers S. 4326 and A. 5379, is amended to read as follows: 6 (E) where an insured requests a liability insurance policy with a term 7 of less than one year from an insurer that offers such policies; 8 provided that the insurer also offers the insured the option of purchas- 9 ing a policy with a term of one year, and: 10 (i) the insurer writes the policy on an occurrence basis; 11 (ii) the insurer writes the policy on a defense cost outside limits 12 basis; 13 (iii) the insurer may extend the policy, provided that: 14 (a) the coverage remains in effect at the same terms and conditions; 15 (b) the rate accords with the rates filed with the superintendent at 16 the policy's inception; and 17 (c) the extension does not result in the policy period exceeding elev- 18 en months in total; 19 (iv) the policy has no annual aggregate liability limit but may have 20 aggregate limits for the term of the policy, and such aggregate limits 21 shall continue with any policy extension provided pursuant to item (iii) 22 of this subparagraph; 23 (v) the policy does not provide medical malpractice coverage; liabil- 24 ity insurance required by articles six, eight, or forty-four-B of the 25 vehicle and traffic law or under any other financial responsibility law 26 of this state; or public entity insurance; 27 (vi) the policy provides for a term of at least one month; EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD08787-02-2A. 8698 2 1 (vii) the policy does not contain a clause limiting the timely filing 2 of a claim; 3 (viii) the policy provides for a return of premium on a pro-rata basis 4 if the insured cancels or otherwise terminates the policy before the 5 policy's expiration; and 6 (ix) the insurer provides a written disclosure to the insured that 7 explains that a policy issued pursuant to this subparagraph may be more 8 expensive than a policy with a term of one year. 9 § 2. Paragraph 9 of subsection (e) of section 3426 of the insurance 10 law, as amended by chapter 235 of the laws of 1989, is amended to read 11 as follows: 12 (9) This subsection shall not apply to a hyper limits excess liability 13 policy except in regard to nonrenewal or to a policy of the type speci- 14 fied in subparagraph (A) [or], (B), or (E) of paragraph two of 15 subsection (d) of this section. 16 § 3. This act shall take effect on the same date and in the same 17 manner as a chapter of the laws of 2021 amending the insurance law 18 relating to providing for a policy term of less than one year in certain 19 situations, as proposed in legislative bills numbers S. 4326 and A. 20 5379, takes effect.
A08698 LFIN:
  | NO LFIN |
A08698 Chamber Video/Transcript:
1-25-22 | Video (@ 00:41:05) | Transcript pdf | Transcript html |