S T A T E O F N E W Y O R K
________________________________________________________________________
5181
2009-2010 Regular Sessions
I N A S S E M B L Y
February 10, 2009
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Introduced by M. of A. P. RIVERA -- Multi-Sponsored by -- M. of A. ALFA-
NO, BARRA -- read once and referred to the Committee on Insurance
AN ACT to amend the insurance law, in relation to use of credit informa-
tion for commercial lines insurance
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Section 2801 of the insurance law is amended by adding two
new subsections (j) and (k) to read as follows:
(J) "COMMERCIAL LINES INSURANCE" SHALL MEAN ANY INSURANCE POLICY THAT
IS A "COVERED POLICY" AS DEFINED IN PARAGRAPH ONE OF SUBSECTION (A) OF
SECTION THREE THOUSAND FOUR HUNDRED TWENTY-SIX OF THIS CHAPTER.
(K) "COMMERCIAL LINES INSURANCE CONSUMER" SHALL MEAN A NATURAL PERSON
WHOSE CREDIT INFORMATION IS USED OR WHOSE INSURANCE SCORE IS CALCULATED
IN THE UNDERWRITING OR RATING OF A POLICY OF COMMERCIAL LINES INSURANCE.
S 2. Section 2809 of the insurance law, as added by chapter 215 of the
laws of 2004, is amended to read as follows:
S [2809] 2810. Severability. If any [section,] paragraph, sentence,
clause, phrase, or any part of SECTIONS TWO THOUSAND EIGHT HUNDRED ONE
THROUGH TWO THOUSAND EIGHT HUNDRED EIGHT OF this article is declared
invalid due to an interpretation of or a future change in the federal
Fair Credit Reporting Act or is adjudged by any court of competent
jurisdiction to be invalid, such judgment, interpretation or change
shall not affect, impair or invalidate the remainder thereof and the
remaining sections, paragraphs, sentences, clauses, phrases, or parts
thereof shall be in no manner affected thereby but shall remain in full
force and effect.
S 3. The insurance law is amended by adding a new section 2809 to read
as follows:
S 2809. USE OF CREDIT INFORMATION IN UNDERWRITING AND RATING COMMER-
CIAL LINES INSURANCE. (A) AN INSURER WRITING COMMERCIAL LINES INSURANCE
WHICH USES CREDIT INFORMATION ON A COMMERCIAL LINES INSURANCE CONSUMER
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD06695-01-9
A. 5181 2
IN UNDERWRITING OR RATING SUCH INSURANCE SHALL DISCLOSE SUCH FACT TO THE
COMMERCIAL LINES INSURANCE CONSUMER AND NAME THE SOURCE OF THE CREDIT
INFORMATION THAT WILL BE USED. THE INSURER SHALL PROVIDE THE DISCLOSURE
REQUIRED BY THIS SUBSECTION TO ANY COMMERCIAL LINES INSURANCE CONSUMER
ON NEW AND RENEWED POLICIES IF CREDIT INFORMATION WILL BE USED.
THE DISCLOSURE REQUIRED BY THIS SUBSECTION SHALL BE PROVIDED IN A
SEPARATE WRITTEN DOCUMENT, WHICH NEED NOT BE PROVIDED IN A SEPARATE
MAILING AS ANOTHER DOCUMENT SO LONG AS THE DISCLOSURE IS PROVIDED ON A
SEPARATE PIECE OF PAPER, EXCEPT THAT WITH REGARD TO A NEW BUSINESS THE
DISCLOSURE MAY BE PROVIDED EITHER IN WRITING OR IN THE SAME MEDIUM AS
THE APPLICATION FOR COMMERCIAL LINES INSURANCE.
(B) AN INSURER WRITING COMMERCIAL LINES INSURANCE WHICH, BASED ON THE
CREDIT INFORMATION OF A COMMERCIAL LINES INSURANCE CONSUMER, DENIES,
CANCELS, NONRENEWS, INCREASES ANY CHARGE FOR OR MAKES ANY OTHER ADVERSE
OR UNFAVORABLE CHANGE IN THE TERMS OF COVERAGE OR ANY INSURANCE, EXIST-
ING OR APPLIED FOR, SHALL PROVIDE NOTIFICATION TO THE COMMERCIAL LINES
INSURANCE CONSUMER THAT SUCH ACTION HAS BEEN TAKEN AND THE REASON FOR
SUCH ACTION. SUCH REASONS SHALL BE PROVIDED IN SUFFICIENTLY CLEAR AND
SPECIFIC LANGUAGE SO THAT A PERSON CAN IDENTIFY THE BASIS FOR THE INSUR-
ER'S DETERMINATION AND IDENTIFY THE SOURCE OF THE CREDIT INFORMATION.
S 4. This act shall take effect on the one hundred twentieth day after
it shall have become a law and shall apply to policies issued and/or
renewed on or after such date.