senate Bill S3857

Relates to the effectiveness of provisions of law establishing an excess line advisory organization

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Sponsor

Bill Status


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

  • 25 / Feb / 2013
    • REFERRED TO INSURANCE
  • 04 / Mar / 2013
    • 1ST REPORT CAL.147
  • 05 / Mar / 2013
    • 2ND REPORT CAL.
  • 06 / Mar / 2013
    • ADVANCED TO THIRD READING
  • 18 / Mar / 2013
    • SUBSTITUTED BY A5694

Summary

Extends the effectiveness of provisions of law establishing an excess line advisory organization until 2019.

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Bill Details

See Assembly Version of this Bill:
A5694
Versions:
S3857
Legislative Cycle:
2013-2014
Law Section:
Insurance
Laws Affected:
Amd ยง5, Chap 630 of 1988

Sponsor Memo

BILL NUMBER:S3857

TITLE OF BILL: An act to amend chapter 630 of the laws of 1988,
amending the insurance law relating to establishing an excess line
advisory organization, in relation to the effective date thereof

PURPOSE: To extend the statutory authority of the Excess Line
Association of New York ("ELANY")

SUMMARY OF PROVISIONS: Section 1 of the bill would amend the language
from Section 5 of Chapter 630 of the Laws of 1988, the enabling
legislation for ELANY, to extend its "sunset" date of July 1, 2014 to
July 1, 2019. Section 2 of the bill sets forth an immediate effective
date.

EXISTING LAW: Chapter 630 of the Laws of 1988 amended the Insurance
Law to add Section 2130, the enabling legislation for ELANY. Section 5
of Chapter 630 currently provides that Section 2130 would cease to be
of any force or effect after July 1, 2014.

JUSTIFICATION: Established by the Legislature in 1988, ELANY, which is
financially self-sustaining, quickly became an indispensable component
in the regulation of the excess line market. The excess line market is
a small, but extremely important marketplace which serves as an
"incubator" for innovative insurance products, as well as a market for
hard-to-place risks. Foremost among ELANY's accomplishments has been
its success in collecting and processing insurance data and monitoring
the solvency of insurers in the excess line marketplace. These
activities are of paramount importance to a properly functioning
excess line market in New York.

As a centralized source of information, ELANY has greatly contributed
to the Department of Financial Services' (aka Insurance Department)
knowledge of a vital segment of New York's insurance market. ELANY
also assists the Department of Financial Services in the calculation
and collection of excess line premium taxes. In fulfilling its
statutory mandate to notify the Superintendent if ELANY believes that
an unauthorized insurer does not meet the standards of eligibility
imposed by New York, ELANY has compiled extensive data on every
foreign and alien insurer writing business in New York, while
monitoring their activities. Based on ELANY's recommendations, the
Department of Financial Services has prohibited the placement of risks
with a number of insurers that were determined by ELANY not to meet
the minimum financial criteria required by New York law. In this
manner, ELANY has protected the interests of New York State consumers
by ensuring that their insurance needs are met by the most financially
secure insurers possible.

In addition, ELANY has taken various measures directed at increasing
compliance by excess line licensees with New York's excess line law.
As part of its effort to achieve this goal, ELANY has created an
electronic platform for the submission and processing of excess line
transactions for use by its member brokers. The use of the electronic
system has reduced frictional cost and improved efficiency and
productivity for both member brokers and ELANY staff EL ANY publishes
newsletters, bulletins and compliance advisors which describe and


explain the complexities and interaction of New York's excess line
law. Department of Financial Services regulations and various
procedures relating to placing insurance in New York's excess line
market. ELANY also maintains an extensive website of organized
information and data which serves as both an educational and
compliance tool for producers.

In fact ELANY recently added a Video Library to its website which
currently contains nine Education/Training videos. Finally, ELANY has
held numerous educational sessions as a Department of Financial
Services-certified educational provider (for both individuals and
groups).

Extending ELANY's statutory authority for another five years is
essential to the ability of ELANY to attract capable personnel and
executives in order to maintain the organization's commitment to
excellence and to make the significant investments in technology that
will enable ELANY to keep pace with developments in the excess line
marketplace. Based on its excellent performance record over its twenty
plus year existence, it is clear that ELANY has demonstrated its
importance to the insurance marketplace. At this juncture, therefore,
there is absolutely no reason to why ELANY's role in helping to
regulate the excess line market should not be substantially extended.

LEGISLATIVE HISTORY: New bill

FISCAL IMPLICATIONS: None.

EFFECTIVE DATE: Immediately.

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

                                  3857

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            February 25, 2013
                               ___________

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

AN ACT to amend chapter 630 of the laws of 1988, amending the  insurance
  law  relating to establishing an excess line advisory organization, in
  relation to the effective date thereof

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

  Section  1. Section 5 of chapter 630 of the laws of 1988, amending the
insurance law relating to  establishing an excess line  advisory  organ-
ization,  as  amended  by chapter 130 of the laws of 2008, is amended to
read as follows:
  S 5. This act shall take effect January 1, 1989 and shall cease to  be
of any force or effect after July 1, [2014] 2019.
  S 2. This act shall take effect immediately.






 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09047-01-3

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