S T A T E   O F   N E W   Y O R K
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                                  2782

                       2013-2014 Regular Sessions

                          I N  A S S E M B L Y

                            January 18, 2013
                               ___________

Introduced by M. of A. O'DONNELL -- Multi-Sponsored by -- M. of A. SCHI-
  MEL -- read once and referred to the Committee on Insurance

AN ACT to amend the insurance law, in relation to prohibiting misleading
  statements  regarding  benefit  maximums  and limitations of benefits,
  either orally or in writing and requiring such  benefit  maximums  and
  limitations  to be stated in clear and plain language in the insurance
  contract or certificate

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

  Section 1. Paragraph 1 of subsection (a) of section 2123 of the insur-
ance  law,  as amended by chapter 540 of the laws of 1996, is amended to
read as follows:
  (1) No agent or representative of any insurer  or  health  maintenance
organization  authorized  to transact life, accident or health insurance
or health maintenance organization business in this state and no  insur-
ance  broker,  and  no  other  person, firm, association or corporation,
shall issue or circulate or cause or permit to be issued or  circulated,
any  illustration, circular, statement or memorandum misrepresenting the
terms, benefits or advantages of any policy or contract of  life,  acci-
dent or health insurance, any annuity contract or any health maintenance
organization  contract, delivered or issued for delivery or to be deliv-
ered or issued for delivery, in this state, OR SHALL MAKE ANY MISLEADING
STATEMENT ORALLY OR IN WRITING AS TO THE TERMS OF COVERAGE OF SUCH POLI-
CY INCLUDING BUT NOT LIMITED TO  BENEFIT  MAXIMUMS  AND  LIMITATIONS  OF
BENEFITS,  or  shall make any misleading estimate as to the dividends or
share of surplus or additional amounts to be received in the  future  on
such policy or contract, or shall make any false or misleading statement
as to the dividends or share of surplus or additional amounts previously
paid  by  any such insurer or health maintenance organization on similar
policies or contracts, or shall make any misleading  representation,  or
any misrepresentation, as to the financial condition of any such insurer

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD01584-01-3
              

A. 2782                             2

or  health  maintenance  organization, or as to the legal reserve system
upon which such insurer or health maintenance organization operates.
  S  2. Paragraph 1 of subsection (a) of section 3217-a of the insurance
law, as added by chapter 705 of the laws of 1996, is amended to read  as
follows:
  (1)  a description of coverage provisions; health care benefits; bene-
fit maximums, including benefit limitations, AND ANY SUCH BENEFIT  MAXI-
MUMS  AND LIMITATIONS SHALL BE DESCRIBED IN CLEAR AND PLAIN LANGUAGE AND
PRINTED IN A FONT SIZE AND TYPE STYLE TO MAKE THEM  CLEARLY  VISIBLE  TO
THE  CONSUMER;  and  exclusions of coverage, including the definition of
medical necessity used in determining whether benefits will be covered;
  S 3. This act shall take effect immediately;  provided,  however  that
section  two  of this act shall take effect on the one hundred eightieth
day after it shall have become a law.