S T A T E O F N E W Y O R K
________________________________________________________________________
6925
2011-2012 Regular Sessions
I N A S S E M B L Y
April 6, 2011
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Introduced by M. of A. MORELLE -- read once and referred to the Commit-
tee on Insurance
AN ACT to amend the insurance law, in relation to certificates of insur-
ance
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. The insurance law is amended by adding a new article 5 to
read as follows:
ARTICLE 5
CERTIFICATES OF INSURANCE
SECTION 501. DEFINITIONS.
502. PROHIBITIONS.
503. STANDARDS FOR FORMS.
504. APPLICABILITY.
505. FEES.
506. ENFORCEMENT AND PENALTIES.
507. RULES AND REGULATIONS.
S 501. DEFINITIONS. FOR PURPOSES OF THIS SECTION: (A) "CERTIFICATE" OR
"CERTIFICATE OF INSURANCE" MEANS ANY DOCUMENT OR INSTRUMENT, NO MATTER
HOW TITLED OR DESCRIBED, WHICH IS PREPARED OR ISSUED BY AN INSURER OR
INSURANCE PRODUCER AS A SUMMARY OR EVIDENCE OF PROPERTY OR CASUALTY
INSURANCE COVERAGE. "CERTIFICATE" OR "CERTIFICATE OF INSURANCE" SHALL
NOT INCLUDE A POLICY OF INSURANCE OR INSURANCE BINDER.
(B) "CERTIFICATE HOLDER" MEANS ANY PERSON, OTHER THAN A POLICYHOLDER,
THAT IS IDENTIFIED ON THE CERTIFICATE AS A CERTIFICATE HOLDER.
(C) "INSURANCE PRODUCER" HAS THE MEANING ASCRIBED TO IT BY SUBSECTION
(K) OF SECTION TWO THOUSAND ONE HUNDRED ONE OF THIS CHAPTER.
(D) "INSURER" MEANS ANY PERSON "DOING AN INSURANCE BUSINESS" AS SUCH
PHRASE IS DEFINED IN SECTION ONE THOUSAND ONE HUNDRED ONE OF THIS CHAP-
TER.
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD10419-01-1
A. 6925 2
(E) "PERSON" MEANS ANY INDIVIDUAL, PARTNERSHIP, CORPORATION, ASSOCI-
ATION, OR OTHER LEGAL ENTITY, INCLUDING ANY PUBLIC ENTITY AS DEFINED IN
PARAGRAPH FIFTY-ONE OF SUBSECTION (A) OF SECTION ONE HUNDRED SEVEN OF
THIS CHAPTER, ANY STATE AUTHORITY AS DEFINED IN SUBDIVISION ONE OF
SECTION TWO OF THE PUBLIC AUTHORITIES LAW, ANY LOCAL AUTHORITY AS
DEFINED IN SUBDIVISION TWO OF SECTION TWO OF THE PUBLIC AUTHORITIES LAW,
AND ANY INTERSTATE OR INTERNATIONAL AUTHORITY AS DEFINED IN SUBDIVISION
THREE OF SECTION TWO OF THE PUBLIC AUTHORITIES LAW.
(F) "POLICYHOLDER" MEANS A PERSON WHO HAS CONTRACTED WITH A PROPERTY
OR CASUALTY INSURER FOR INSURANCE COVERAGE.
S 502. PROHIBITIONS. (A) NO PERSON SHALL PREPARE, ISSUE, OR REQUIRE
THE ISSUANCE OF A CERTIFICATE UNLESS THE FORM HAS BEEN FILED WITH AND
APPROVED BY THE SUPERINTENDENT. NO PERSON SHALL ALTER OR MODIFY AN
APPROVED CERTIFICATE OF INSURANCE FORM.
(B) NO PERSON, WHEREVER LOCATED, SHALL DEMAND OR REQUEST THE ISSUANCE
OF A CERTIFICATE OF INSURANCE FROM AN INSURER, INSURANCE PRODUCER, OR
POLICYHOLDER THAT CONTAINS ANY FALSE OR MISLEADING INFORMATION CONCERN-
ING THE POLICY OF INSURANCE TO WHICH THE CERTIFICATE MAKES REFERENCE.
(C) NO PERSON, WHEREVER LOCATED, SHALL KNOWINGLY PREPARE OR ISSUE A
CERTIFICATE OF INSURANCE THAT PURPORTS TO ALTER, AMEND, OR EXTEND THE
TERMS OR COVERAGE PROVIDED BY THE POLICY OF INSURANCE TO WHICH THE
CERTIFICATE MAKES REFERENCE.
(D) NO PERSON SHALL PREPARE, ISSUE, OR REQUEST, EITHER IN ADDITION TO
OR IN LIEU OF A CERTIFICATE OF INSURANCE, AN OPINION LETTER OR OTHER
DOCUMENT OR CORRESPONDENCE THAT IS INCONSISTENT WITH THIS SECTION;
HOWEVER, AN INSURER OR INSURANCE PRODUCER MAY PREPARE OR ISSUE AN ADDEN-
DUM TO A CERTIFICATE THAT CLARIFIES AND EXPLAINS THE COVERAGE PROVIDED
BY A POLICY OF INSURANCE AND OTHERWISE COMPLIES WITH THE REQUIREMENTS OF
THIS SECTION.
S 503. STANDARDS FOR FORMS. (A) THE SUPERINTENDENT SHALL DISAPPROVE A
FORM FILED UNDER THIS SECTION, OR WITHDRAW APPROVAL OF A FORM, IF THE
FORM:
(1) IS MISLEADING, OR DECEPTIVE, OR VIOLATES PUBLIC POLICY; OR
(2) VIOLATES ANY LAW, OR REGULATION ADOPTED BY THE SUPERINTENDENT.
(B) STANDARD CERTIFICATE OF INSURANCE FORMS PROMULGATED BY THE ASSOCI-
ATION FOR COOPERATIVE OPERATIONS RESEARCH AND DEVELOPMENT ARE DEEMED
APPROVED BY THE SUPERINTENDENT AND ARE NOT REQUIRED TO BE FILED IF THE
FORMS OTHERWISE COMPLY WITH THE REQUIREMENTS OF THIS SECTION.
(C) NO CERTIFICATE OF INSURANCE SHALL CONTAIN REFERENCES TO CONTRACTS,
INCLUDING CONSTRUCTION OR SERVICE CONTRACTS, OTHER THAN THE REFERENCED
CONTRACT OF INSURANCE. NOTWITHSTANDING ANY REQUIREMENT, TERM, OR CONDI-
TION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH A CERTIF-
ICATE OF INSURANCE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED
BY THE REFERENCED POLICY OF INSURANCE IS SUBJECT TO ALL THE TERMS,
EXCLUSIONS AND CONDITIONS OF THE POLICY ITSELF.
(D) THE SUPERINTENDENT SHALL NOT APPROVE A CERTIFICATE OF INSURANCE
FORM THAT DOES NOT STATE THAT A CERTIFICATE OF INSURANCE IS NOT A POLICY
OF INSURANCE AND DOES NOT AMEND, EXTEND, OR ALTER THE COVERAGE AFFORDED
BY THE POLICY TO WHICH THE CERTIFICATE OF INSURANCE MAKES REFERENCE. A
CERTIFICATE OF INSURANCE SHALL NOT CONFER TO A CERTIFICATE HOLDER NEW OR
ADDITIONAL RIGHTS BEYOND WHAT THE REFERENCED POLICY OF INSURANCE
EXPRESSLY PROVIDES.
(E) A CERTIFICATE HOLDER SHALL ONLY HAVE A LEGAL RIGHT TO NOTICE OF
CANCELLATION, NONRENEWAL, OR ANY MATERIAL CHANGE, OR ANY SIMILAR NOTICE
CONCERNING A POLICY OF INSURANCE IF THE CERTIFICATE HOLDER IS NAMED
WITHIN THE POLICY OR ANY ENDORSEMENT AND THE POLICY OR ENDORSEMENT
A. 6925 3
REQUIRES NOTICE TO BE PROVIDED TO THE CERTIFICATE HOLDER. THE TERMS AND
CONDITIONS OF THE NOTICE, INCLUDING THE REQUIRED TIMING OF THE NOTICE,
ARE GOVERNED BY THE POLICY OF INSURANCE AND CANNOT BE ALTERED BY A
CERTIFICATE OF INSURANCE.
S 504. APPLICABILITY. THE PROVISIONS OF THIS SECTION SHALL APPLY TO
ALL CERTIFICATE HOLDERS, POLICYHOLDERS, INSURERS, INSURANCE PRODUCERS,
AND CERTIFICATE OF INSURANCE FORMS ISSUED AS EVIDENCE OF INSURANCE
COVERAGES ON PROPERTY, OPERATIONS, OR RISKS LOCATED IN THIS STATE,
REGARDLESS OF WHERE THE CERTIFICATE HOLDER, POLICYHOLDER, INSURER, OR
INSURANCE PRODUCER IS LOCATED.
S 505. FEES. AN INSURANCE PRODUCER MAY CHARGE A REASONABLE SERVICE
FEE FOR ISSUING A CERTIFICATE TO A POLICY HOLDER OR CERTIFICATE HOLDER,
PROVIDED THAT THE INSURANCE PRODUCER COMPLIES WITH THE PROVISIONS OF
SECTION TWO THOUSAND ONE HUNDRED NINETEEN OF THIS CHAPTER.
S 506. ENFORCEMENT AND PENALTIES. (A) THE SUPERINTENDENT SHALL HAVE
THE POWER TO LEVY A PENALTY NOT EXCEEDING ONE THOUSAND DOLLARS FOR EACH
VIOLATION AGAINST ANY PERSON WHO VIOLATES THIS ARTICLE.
(B) THE SUPERINTENDENT SHALL HAVE THE POWER TO EXAMINE AND INVESTIGATE
THE ACTIVITIES OF ANY PERSON THAT THE SUPERINTENDENT REASONABLY BELIEVES
HAS BEEN OR IS ENGAGED IN AN ACT OR PRACTICE PROHIBITED BY THIS ARTICLE.
THE SUPERINTENDENT SHALL HAVE THE POWER TO ENFORCE THE PROVISIONS OF
THIS SECTION AND IMPOSE ANY AUTHORIZED PENALTY OR REMEDY AGAINST ANY
PERSON WHO VIOLATES THIS ARTICLE.
S 507. RULES AND REGULATIONS. THE SUPERINTENDENT MAY ADOPT RULES OR
REGULATIONS AS HE OR SHE CONSIDERS APPROPRIATE TO CARRY OUT THE
PROVISIONS OF THIS ARTICLE.
S 2. This act shall take effect on the one hundred eightieth day after
it shall have become a law.