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A00807 Summary:

Amd §2324, Ins L
Permits insurers to provide certain loss prevention and risk management devices to insureds and prospective insureds.
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A00807 Memo:

submitted in accordance with Assembly Rule III, Sec 1(f)
SPONSOR: Pretlow
  TITLE OF BILL: An act to amend the insurance law, in relation to permitting insurers to provide certain loss prevention and risk management devices to insureds and prospective insureds   SUMMARY OF SPECIFIC PROVISIONS: Section 1 of the bill amends the insurance law to allow auto insurance companies to provide certain loss prevention and risk management devices to their insureds and prospective insureds, and to offer certain incen- tives for participating in such programs. Section 2 of the bill provides for an effective date.   JUSTIFICATION: This bill would allow insurance companies to offer incentives to both insureds and prospective insureds, for participating in certain loss prevention and risk management programs through the use of "telematics devices" to monitor the driving habits of those individuals participat- ing in the rewards program. "Telematics" refers to the technology of sending, receiving, and storing information relating to remote objects, such as vehicles, via telecommunication devices. The term is often used to refer specifically to the use of the technology in connection with ' the provision of auto insurance The bill would clarify that telematics rewards programs do not violate the "anti-rebate" provisions of Section 2324 of the New York State Insurance Law. Currently, it is estimated that the vast majority of the states allow for such telematics rewards programs and recognize that these programs do not in any way constitute an improper rebate under their state's respective anti-rebate statutes. This bill would clarify this program in New York in a similar fashion. By being able to offer incentives for both insured and prospective insureds to participate in telematics and risk management programs, insurance companies can help drivers to improve their driving habits, thereby resulting in safer conditions on the state's roads and highways. Additionally, partic- ipation in this type of real-time data monitoring program would be completely voluntary and would have no effect on the existing rates of insured drivers, should they decide not to participate. The auto insurance industry is revolutionizing as technology develops, and this legislation simply amends present law to recognize both the validity, desirability and legality of a program that simply could not have been anticipated when the anti-rebate sections of the Insurance Law were first adopted.   PRIOR LEGISLATIVE HISTORY: 2021-2022A1545 referred to insurance 2019-2020A3834 referred to insurance 06/05/15A8060 referred to insurance 01/06/16A8060 referred to insurance 2017/2018A4338 referred to insurance   FISCAL IMPLICATIONS: None.   EFFECTIVE DATE: The bill is'effective immediately.
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