NY State Senate Bill 2009-S5580

Archive: Last Bill Status - In Senate Committee Insurance Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

View Actions

	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 06, 2010	referred to insurance
Jul 16, 2009	committed to rules
Jun 03, 2009	advanced to third reading
Jun 02, 2009	2nd report cal.
Jun 01, 2009	1st report cal.510
May 19, 2009	referred to insurance

2009-S5580 (ACTIVE) - Details

Current Committee:: Senate Insurance
Law Section:: Insurance Law
Laws Affected:: Amd §§4216 & 4235, Ins L

2009-S5580 (ACTIVE) - Summary

Relates to group life and group accident and health insurance policies; revises certain provisions relating to minimum participation requirements by employees in group life and certain group accident and health insurance contracts.

2009-S5580 (ACTIVE) - Sponsor Memo

                                 BILL NUMBER:  S5580

 TITLE OF BILL :
An act to amend the insurance law, in relation to group life and group
accident and health insurance policies


 PURPOSE OR GENERAL IDEA OF BILL :
This bill would amend §§4216 and 4235 of the Insurance Law to revise
certain provisions relating to requisite minimum participation
requirements by employees in group life and certain group accident and
health insurance contracts. This bill would also remove current
restrictions on the sub-selections that may be made by employers when
establishing group life and group accident and health insurance plans.

 SUMMARY OF PROVISIONS :
This bill would amend paragraph (1) of subsection (b) of section 4216
of the Insurance Law to:  reduce the minimum number of eligible
employees that must be insured under a group life insurance plan to
two and; to eliminate certain restrictions on the amount of
sub-selections that may be offered under a group life insurance plan.
This bill would also make a similar amendment to subparagraph (A) of
paragraph (1) of subsection (c) of section 4235 of the Insurance Law
relating to group accident and health insurance, with the exception
being that the current minimum group participation requirements will
continue for hospital, medical, major medical or similar comprehensive

type expense reimbursed coverage but will be reduced to two for all
other types of group accident and health insurance (disability, long
term care, vision, dental, etc.).

 JUSTIFICATION :
In recent years, employee benefits have changed significantly. There
was a time when employers paid a substantial portion or even all of
the cost of employee benefits. Many corporations still do but, due to
the increasing burden of insurance costs, employers of all sizes have
also been forced to reduce their contributions to the benefit plans
offered to their employees, in order to continue to afford such
employee coverage. Employees have increasingly been asked to share.
these costs with their employer. Today, 25% of the group life
insurance market is fully voluntary, in that the employee elects
coverage and may pay some or all of the premiums for such coverage.
By offering these voluntary products through an employer group, the
employer can offer their employees the advantage of payroll deduction,
limited underwriting and other efficiencies in administration that can
often times lead to cheaper insurance premiums for the employee.

In looking at how best to meet the demands of the marketplace, in
particular to small businesses, it was determined that certain
restrictions in the group laws of several states, including New York,
created an impediment to a number of otherwise common group offerings.
These provisions, written many years ago for a purpose that no longer
exists (to protect insurers from adverse selection in the underwriting
process), restrict employee access to voluntary coverage.  Given the
realities of today's employer group market, these outdated laws are
ill-suited to protect and benefit consumers.

This bill would remove these impediments and create the ability for
insurers to tailor more attractive and available group coverage for
employers and employees in New York. It would allow insurers to offer
group coverage to as little as 2 employees of any employer who elect
to take part in a group life, disability income, long term care,
vision or dental policy by removing the current restriction that the
group must be an arbitrary size to offer such coverage.

 PRIOR LEGISLATIVE HISTORY :
2008: S.7766
 FISCAL IMPLICATIONS :
No known costs to the State are associated with this bill.

 EFFECTIVE DATE .up off; :
This act shall take effect immediately.

2009-S5580 (ACTIVE) - Bill Text download pdf

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

                                  5580

                       2009-2010 Regular Sessions

                            I N  S E N A T E

                              May 19, 2009
                               ___________

Introduced  by  Sen. BRESLIN -- 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 group life  and  group
  accident and health insurance policies

  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 4216 of the insur-
ance law, as amended by chapter 369 of the laws of 1985, is  amended  to
read as follows:
  (1)  A  policy  issued to an employer or to a trustee or trustees of a
fund established by an employer, which employer  or  trustees  shall  be
deemed the policyholder, insuring with or without evidence of individual
insurability  satisfactory  to  the insurer, employees of such employer,
and insuring, except as hereinafter provided, all of such  employees  or
all  of any class or classes thereof determined by conditions pertaining
to the employment, [or by a combination of such  conditions  and  condi-
tions  pertaining  to the family status of the employee,] for amounts of
insurance on each  person  insured  based  upon  some  plan  which  will
preclude individual selection. [However, such a plan may permit a limit-
ed number of selections by employees if the selections offered utilize a
consistent  pattern  of  grading the amounts of insurance for individual
group members so that the resulting pattern of coverage is  reasonable.]
The  premium  for  the  policy shall be paid by the policyholder, either
wholly from the employer's funds [or funds contributed by him]  or  from
funds  contributed  by  the insured employees, or from funds contributed
jointly by the employer and employees. If all or part of the premium  is
to  be  derived  from  funds  contributed by the insured employees, such
policy must insure not less than [fifty percent of such eligible employ-
ees or, if less, fifty  or  more]  TWO  of  such  employees.  Except  as
provided  in subsection (b) of section four thousand two hundred thirty-
one of this article and in paragraph five of subsection (a)  of  section

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09479-01-9

S. 5580                             2

three  thousand  two  hundred  twenty of this chapter, such policy shall
provide for payment of all benefits thereunder, to the person insured or
to some beneficiary or beneficiaries other than the employer, and  shall
provide for the issuance of a certificate to the policyholder for deliv-
ery  to  the  person insured or to such beneficiary, as evidence of such
insurance.
  S 2. Subparagraph (A) of paragraph 1 of subsection (c) of section 4235
of the insurance law, as separately amended by chapters 369 and  846  of
the laws of 1985, is amended to read as follows:
  (A)  A  policy  issued to an employer or to a trustee or trustees of a
fund established by an employer, which employer or trustee  or  trustees
shall  be  deemed the policyholder, insuring with or without evidence of
insurability satisfactory to the insurer, employees  of  such  employer,
and  insuring,  except as hereinafter provided, all of such employees or
all of any class or classes thereof determined by conditions  pertaining
to  the  employment  [or a combination of such conditions and conditions
pertaining to the family status of the employee,] for insurance coverage
on each person insured based upon some plan which will preclude individ-
ual selection. [However, such a plan may  permit  a  limited  number  of
selections  by  employees  if  the selections offered utilize consistent
plans of coverage for individual group members  so  that  the  resulting
plans  of  coverage are reasonable.] The premium for the policy shall be
paid by the policyholder, either from  the  employer's  funds,  or  from
funds  contributed  by  the insured employees, or from funds contributed
jointly by the employer and employees.  [If]  WHERE  A  POLICY  PROVIDES
HOSPITAL,  MEDICAL,  MAJOR  MEDICAL  OR  SIMILAR  COMPREHENSIVE TYPES OF
EXPENSE REIMBURSED COVERAGE AND all or part of  the  premium  is  to  be
derived from funds contributed by the insured employees, then such poli-
cy  must  insure  not less than fifty percent of such eligible employees
or, if less, fifty or more of such employees. FOR OTHER TYPES OF  COVER-
AGE,  IF ALL OR PART OF THE PREMIUM IS TO BE DERIVED FROM FUNDS CONTRIB-
UTED BY THE INSURED EMPLOYEES, THEN SUCH POLICY  MUST  INSURE  NOT  LESS
THAN TWO OF SUCH EMPLOYEES.
  S 3. This act shall take effect immediately.

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Senate Bill S5580

Sponsored By

Archive: Last Bill Status - In Senate Committee Insurance Committee

2009-S5580 (ACTIVE) - Details

2009-S5580 (ACTIVE) - Summary

2009-S5580 (ACTIVE) - Sponsor Memo

2009-S5580 (ACTIVE) - Bill Text download pdf

Comments

Senate Bill S5580

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Sponsored By

Neil D. Breslin

Archive: Last Bill Status - In Senate Committee Insurance Committee

2009-S5580 (ACTIVE) - Details

2009-S5580 (ACTIVE) - Summary

2009-S5580 (ACTIVE) - Sponsor Memo

2009-S5580 (ACTIVE) - Bill Text download pdf

Comments