Senate Bill S7781

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

                                  7781

                            I N  S E N A T E

                              June 18, 2012
                               ___________

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

AN ACT to amend the insurance law, in  relation  to  limits  on  certain
  supplementary insurance

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

  Section 1. Paragraph 2 of subsection (f) of section 3420 of the insur-
ance law, as separately amended by chapters 547 and 568 of the  laws  of
1997, is amended to read as follows:
  (2)  (A)  Any  [such]  PRIVATE  PASSENGER  AUTOMOBILE INSURANCE policy
shall[, at the  option  of  the  insured,  also]  provide  supplementary
uninsured/underinsured  motorists  insurance  for  bodily injury[, in an
amount up to] IN THE SAME AMOUNT AS the bodily injury  liability  insur-
ance  limits  of  coverage  provided  under [such] THE PRIVATE PASSENGER
AUTOMOBILE INSURANCE policy[, subject to a maximum of two hundred  fifty
thousand  dollars  because of bodily injury to or death of one person in
any one accident and, subject to such limit for one person, up  to  five
hundred  thousand dollars because of bodily injury to or death of two or
more persons in any one accident, or a combined single limit  policy  of
five  hundred  thousand  dollars because of bodily injury to or death of
one or more persons in any one accident. Provided  however,  an  insurer
issuing  such  policy,  in lieu of offering to the insured the coverages
stated above, may provide supplementary uninsured/underinsured motorists
insurance for bodily injury, in  an  amount  up  to  the  bodily  injury
liability  insurance  limits  of  coverage  provided  under such policy,
subject to a maximum of one hundred thousand dollars because  of  bodily
injury  to  or  death  of one person in any one accident and, subject to
such limit for one person, up to three hundred thousand dollars  because
of bodily injury to or death of two or more persons in any one accident,
or  a  combined  single  limit  policy of three hundred thousand dollars
because of bodily injury to or death of one or more persons in  any  one
accident, if such insurer also makes available a personal umbrella poli-
cy  with  liability coverage limits up to at least five hundred thousand
dollars    which    also    provides    coverage    for    supplementary

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

                                                           LBD15532-06-2

S. 7781                             2

uninsured/underinsured  motorists claims].   THE COVERAGE REQUIRED UNDER
THIS PARAGRAPH IS NOT APPLICABLE WHEN, OR TO THE EXTENT THAT, AN INSURED
NAMED IN THE POLICY MAKES A REJECTION OF THE COVERAGE ON BEHALF  OF  ALL
INSUREDS  UNDER  THE POLICY.   SUCH REJECTION MAY BE MEMORIALIZED BY THE
INSURER THROUGH A SIGNED WRITING, AUDIO RECORDING, ELECTRONIC  SIGNATURE
OR  ANY OTHER MEANS EVIDENCING THE INSURED'S REJECTION OF SUCH COVERAGE.
Supplementary uninsured/underinsured motorists insurance  shall  provide
coverage,  in any state or Canadian province, if the limits of liability
under all bodily  injury  liability  bonds  and  insurance  policies  of
[another]  ANY  OTHER  motor  vehicle liable for damages are in a lesser
amount than the bodily injury liability  insurance  limits  of  coverage
provided  by such policy. Upon written request by any insured covered by
supplemental uninsured/underinsured  motorists  insurance  or  his  duly
authorized  representative  and  upon  disclosure  by the insured of the
insured's bodily injury and supplemental  uninsured/underinsured  motor-
ists insurance coverage limits, the insurer of any other owner or opera-
tor  of  another  motor  vehicle against which a claim has been made for
damages to the insured shall disclose, within  forty-five  days  of  the
request,  the  bodily  injury liability insurance limits of its coverage
provided under the policy or all bodily injury liability bonds. The time
of the insured to make any supplementary uninsured/underinsured motorist
claim, shall be tolled during the period the insurer of any other  owner
or  operator  of another motor vehicle that may be liable for damages to
the insured, fails to so disclose its coverage. As a condition precedent
to the  obligation  of  the  insurer  to  pay  under  the  supplementary
uninsured/underinsured  motorists  insurance  coverage,  the  limits  of
liability of [all] bodily injury liability bonds or  insurance  policies
applicable  at the time of the accident shall be exhausted by payment of
judgments or settlements.
  (B) [In addition to the notice provided, upon issuance of a policy  of
motor vehicle liability insurance pursuant to regulations promulgated by
the  superintendent,] AT THE TIME THE POLICY IS SOLD, PURCHASED OR NEGO-
TIATED insurers shall notify insureds, in [writing] WRITTEN,  VERBAL  OR
ELECTRONIC  FORMAT,  of  the  NATURE  AND  availability of supplementary
uninsured/underinsured motorists  coverage  AND  SHALL  STATE  THAT  THE
COVERAGE  IS EQUAL TO BODILY INJURY LIABILITY LIMITS UNLESS LOWER LIMITS
ARE REQUESTED OR THE  COVERAGE  IS  REJECTED.  Such  notification  shall
contain an explanation of supplementary uninsured/underinsured motorists
coverage  and  the  amounts  in  which it can be purchased.  SUCH NOTICE
SHALL STATE THE FOLLOWING OR INCLUDE INFORMATION  SUBSTANTIALLY  SIMILAR
TO THE FOLLOWING:
  "SUPPLEMENTARY  UNINSURED/UNDERINSURED  MOTORISTS COVERAGE (SUM COVER-
AGE) SHALL BE EQUAL TO  BODILY  INJURY  LIABILITY  LIMITS  UNLESS  LOWER
LIMITS  ARE REQUESTED OR THE COVERAGE IS REJECTED. A POLICYHOLDER SHOULD
CONSIDER PURCHASING SUM COVERAGE IN ORDER TO PROTECT AGAINST THE  POSSI-
BILITY  OF  AN  ACCIDENT  INVOLVING ANOTHER MOTOR VEHICLE WHOSE OWNER OR
OPERATOR WAS NEGLIGENT AND WHO MAY HAVE NO INSURANCE WHATSOEVER; OR EVEN
IF INSURED, IS ONLY INSURED FOR THIRD-PARTY BODILY INJURY AT  RELATIVELY
LOW  LIABILITY LIMITS, IN COMPARISON TO THE POLICYHOLDER'S OWN LIABILITY
LIMITS FOR BODILY INJURY SUSTAINED BY THIRD-PARTIES. BY  PURCHASING  SUM
COVERAGE, WHICH CANNOT BE PURCHASED IN AN AMOUNT EXCEEDING THE AMOUNT OF
THIRD  PARTY  LIABILITY  COVERAGE  PURCHASED,  THE  POLICYHOLDER AND ANY
INSURED UNDER THE POLICY CAN BE PROTECTED FOR  BODILY  INJURY  TO  THEM-
SELVES,  UP TO THE LIMIT OF THE SUM COVERAGE PURCHASED; AND RECEIVE FROM
THE POLICYHOLDER'S OWN INSURANCE PAYMENT FOR BODILY INJURY SUSTAINED DUE
TO THE NEGLIGENCE OF THE  OTHER  MOTOR  VEHICLE'S  OWNER  OR  OPERATOR."

S. 7781                             3

Subsequently,  a notification of availability shall be provided at least
once a year and may be simplified pursuant to regulations promulgated by
the superintendent, but must include a concise statement that supplemen-
tary uninsured/underinsured motorists coverage is available, an explana-
tion  of  such  coverage,  and the coverage limits that can be purchased
from the insurer.
  (C) WHEN THERE IS A DISPUTE BETWEEN AN INSURER AND  INSURED  OVER  THE
AMOUNT OF SUPPLEMENTARY UNINSURED/UNDERINSURED MOTORISTS COVERAGE AVAIL-
ABLE ON A CLAIM AND THE INSURER ULTIMATELY PROVIDES COVERAGE HIGHER THAN
THE AMOUNT OF PREMIUM THE INSURER IS CHARGING FOR, AN INSURER MAY DEDUCT
ANY  PREMIUM DUE FROM A RE-RATING OF THE POLICY BACK TO THE POLICY ISSUE
DATE AGAINST ANY BENEFITS DUE ON THE CLAIM.
  S 2.  This act shall take effect on  the  one  hundred  eightieth  day
after  it shall have become a law, and shall apply to insurance policies
and contracts issued, entered into or renewed on and after such date.