senate Bill S6131

Makes technical corrections relating to the treatment of qualified financial contracts in an insurance insolvency proceeding

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Bill Status


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor
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actions

  • 04 / Jan / 2012
    • REFERRED TO INSURANCE
  • 09 / Jan / 2012
    • REPORTED AND COMMITTED TO RULES
  • 09 / Jan / 2012
    • ORDERED TO THIRD READING CAL.19
  • 18 / Jan / 2012
    • SUBSTITUTED BY A8903

Summary

Makes technical corrections relating to the treatment of qualified financial contracts in an insurance insolvency proceeding affecting a domestic, foreign or alien insurer.

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Bill Details

See Assembly Version of this Bill:
A8903
Versions:
S6131
Legislative Cycle:
2011-2012
Law Section:
Insurance Law
Laws Affected:
Amd ยง7437, Ins L

Votes

17
0
17
Aye
0
Nay
1
aye with reservations
0
absent
0
excused
0
abstained
show Insurance committee vote details

Sponsor Memo

BILL NUMBER:S6131

TITLE OF BILL:

An act
to amend the insurance
law, in
relation to making technical corrections thereto

PURPOSE:

This bill would make technical corrections to Chapter 600 of the Laws
of 2011.

SUMMARY OF SPECIFIC PROVISIONS:

Specifically, this bill would make technical corrections to Chapter
600 of the Laws of 2011 (S.2713-A/A.6603-A) which amended the
insurance law, in relation to the treatment of qualified financial
contracts in an insurance insolvency proceeding affecting a domestic,
foreign or alien insurer (so as to increase the certainty of insurers
and their creditors with respect to the enforceability of certain
financial market transactions and related netting agreements in the
event of insurer insolvency). These technical corrections would amend
such chapter to include contracts in connection with netting
agreements, and to expressly exclude rights against an insurer
licensed to write financial guaranty insurance.

JUSTIFICATION:

This bill would make two clarifying amendments to Chapter 600, so as
to specify that financial guaranty insurance would not be included
within its provisions, and that contracts in connection with netting
agreements would be so included, as was the intent of the original
chapter.

PRIOR LEGISLATIVE HISTORY:

This is a new bill.

BUDGET IMPLICATIONS:

None Noted.

EFFECTIVE DATE:

This act would be deemed to have taken effect on December 12, 2011 (the
effective date of Chapter 600).

view bill text
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  6131

                            I N  S E N A T E

                               (PREFILED)

                             January 4, 2012
                               ___________

Introduced  by  Sen.  SEWARD -- read twice and ordered printed, and when
  printed to be committed to the Committee on Insurance

AN ACT to amend the insurance  law,  in  relation  to  making  technical
  corrections thereto

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Paragraph 1 of subsection (b) of section 7437 of the insur-
ance law, as added by chapter 600 of the laws of  2011,  is  amended  to
read as follows:
  (1) Notwithstanding any other provision of this article, including any
other   provision   of  this  article  permitting  the  modification  of
contracts, or other law of this state, no  person  shall  be  stayed  or
prohibited  from exercising: (A) a contractual right to cause the termi-
nation, liquidation, acceleration or close out of any  obligation  under
OR  IN  CONNECTION  WITH  a  netting  agreement  or  qualified financial
contract with an insurer, other than an insurer licensed to write finan-
cial guaranty insurance,  because  of:  (i)  the  insolvency,  financial
condition or default of the insurer at any time, provided that the right
is enforceable under applicable law other than this article; or (ii) the
commencement of any proceeding under this article; (B) any right under a
security arrangement relating to one or more netting agreements or qual-
ified  financial  contracts,  OTHER  THAN  A  RIGHT  AGAINST  AN INSURER
LICENSED TO WRITE FINANCIAL GUARANTY INSURANCE; or (C)  subject  to  any
provision of subsection (b) of section seven thousand four hundred twen-
ty-seven of this article, any right to offset or net out any termination
value,  payment amount, or other transfer obligation arising under or in
connection with one or more qualified financial contracts, OTHER THAN  A
RIGHT AGAINST AN INSURER LICENSED TO WRITE FINANCIAL GUARANTY INSURANCE,
where  the  counterparty or its guarantor is organized under the laws of
the United States, a state, or a foreign jurisdiction  approved  by  the
Securities  Valuation  Office  of  the National Association of Insurance
Commissioners as eligible for netting.
  S 2. This act shall take effect on the  same  date  and  in  the  same
manner as chapter 600 of the laws of 2011 took effect.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD05498-08-2

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