S T A T E O F N E W Y O R K
________________________________________________________________________
6556
2017-2018 Regular Sessions
I N S E N A T E
June 2, 2017
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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 maintaining an action
against a liability insurer seeking compensatory damages in excess of
the policy limits where such insurer failed to engage in prompt and
fair settlement of the claim
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Section 3420 of the insurance law is amended by adding a
new subsection (b-1) to read as follows:
(B-1) AN ACTION MAY ALSO BE MAINTAINED BY THE PERSONS IDENTIFIED IN
PARAGRAPHS ONE, TWO AND THREE OF SUBSECTION (B) OF THIS SECTION AGAINST
THE INSURER TO RECOVER COMPENSATORY DAMAGES FROM SUCH INSURER TO THE
FULL EXTENT OF THE JUDGEMENT AGAINST THE INSURED, NOT LIMITED TO THE
POLICY LIMITS AND NOT SUBJECT TO THE LIMITATIONS AND CONDITIONS OF PARA-
GRAPH TWO OF SUBSECTION (A) OF THIS SECTION, WHERE THE INSURER FAILED TO
EFFECTUATE A PROMPT AND FAIR SETTLEMENT OF A CLAIM OR ANY PORTION THERE-
OF, AND THE INSURER FAILED TO REASONABLY ACCORD AT LEAST EQUAL OR MORE
FAVORABLE CONSIDERATION TO ITS INSURED'S INTERESTS AS IT DID TO ITS OWN
INTERESTS, AND THEREBY EXPOSED THE INSURED TO A JUDGEMENT IN EXCESS OF
THE POLICY LIMITS.
§ 2. This act shall take effect immediately.
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD11796-01-7