NY State Senate Bill S769A

Archive: Last Bill Status - Passed Senate

Introduced
In Committee
On Floor Calendar
- Passed Senate
- Passed Assembly
Delivered to Governor
Signed/Vetoed by Governor

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Actions

view actions (18)

	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Mar 11, 2020	referred to insurance delivered to assembly passed senate
Jan 29, 2020	advanced to third reading
Jan 28, 2020	2nd report cal.
Jan 27, 2020	1st report cal.288
Jan 08, 2020	referred to insurance returned to senate died in assembly
May 30, 2019	referred to insurance delivered to assembly passed senate
May 01, 2019	advanced to third reading
Apr 30, 2019	2nd report cal.
Apr 29, 2019	1st report cal.461
Mar 18, 2019	print number 769a
Mar 18, 2019	amend and recommit to insurance
Jan 09, 2019	referred to insurance

Votes

view votes

Mar 11, 2020 - floor Vote

S769A

floor

Aye

Nay

Absent

Excused

Abstained

Jan 27, 2020 - Insurance committee Vote

S769A

committee

Aye

Nay

Aye with Reservations

Absent

Excused

Abstained

May 30, 2019 - floor Vote

S769A

floor

Aye

Nay

Absent

Excused

Abstained

Apr 29, 2019 - Insurance committee Vote

S769A

committee

Aye

Nay

Aye with Reservations

Absent

Excused

Abstained

Bill Amendments

Original

A (Active)

Original

A (Active)

Co-Sponsors

S769 - Details

See Assembly Version of this Bill:: A8842
Current Committee:: Assembly Insurance
Law Section:: Insurance Law
Laws Affected:: Amd §2118, Ins L
Versions Introduced in 2021-2022 Legislative Session:: S498, A5241

S769 - Summary

Relates to permitting certain insurance coverage to be placed by licensed excess line brokers with unauthorized insurers without regard to the diligent effort requirement and simplifying the excess line insurance placement affidavit requirements.

S769 - Sponsor Memo

 
BILL NUMBER: S769

SPONSOR: BRESLIN
 
TITLE OF BILL:

An act to amend the insurance law, in relation to permitting certain
insurance coverage to be placed by licensed excess line broker with
unauthorized insurers without regard to the diligent effort requirement
and simplifying the excess line insurance placement affidavit require-
ments

 
PURPOSE:

To exempt commercial lines insurance transactions placed by wholesale
insurance brokers from the excess line diligent effort requirement, and
streamline the excess line affidavit regarding declinations that is
filed by insurance brokers when placing excess line business.

 
SUMMARY OF PROVISIONS:

Section 1. Subparagraph (A) of paragraph 3 of subsection (b) of section

2118 of the insurance law, as amended by section 12 of part I of chapter
61 of the laws of 2011 is amended to exempt commercial lines insurance
transactions placed by wholesale insurance brokers from the excess line
diligent effort requirement.

Section 2. Subparagraph (C) of paragraph 3 of subsection (b) of section
2118 of the insurance law, as amended by chapter 684 of the laws of 1993
is amended to specify the diligent effort requirements under this legis-
lation.

Section 3. Section 2119 of the insurance law is amended by adding a new
subsection (g) to define "retail insurance broker," "wholesale excess
line insurance broker," and "commercial lines insurance."

(2) Specifies the allowable affiliation between the retail insurance
broker and a wholesale excess line insurance broker for the purposes of
this section.

Section 4. Effective Date

 
JUSTIFICATION:

This legislation would expedite service to insureds while maintaining
the state's ability to protect consumers. The excess line market exists
to insure risks which New York admitted insurers choose not to under-
write because the risks are distressed, unique, volatile, or involve new
businesses or coverages without loss history. The market is of vital
importance to New York and nimble processing is essential to effectively
serve consumer needs.

Approximately 17% of New York licensed insurance brokers place excess
line business through wholesale brokers for an annual average of twen-
ty-five transactions each. This is a strong indicator that retailers
only go to wholesalers when the retailers admitted markets refuse to
insure a risk.

However, the more complicated the affidavit, the more burdensome and
time consuming it is for the wholesale excess line insurance broker to
obtain it from the retail insurance broker for filing with ELANY.  This
can lead to unnecessary delayed transactions which is to the consumer's
detriment.

New York is one of only ten states that require the filing of declina-
tion information, and the only state that requires twenty-one elements
in total for three separate declinations.

Insurance brokers would still be required to file insurance coverage
documents and affidavits with the Excess Line Association of New York
(ELANY) and all elements would still be available to the Department of
Financial Services upon request.

 
LEGISLATIVE HISTORY:

This is a new bill.

 
FISCAL IMPLICATIONS:

None.

 
EFFECTIVE DATE:
This act shall take effect immediately, provided, however, that the
amendments to subparagraphs (A) and (C) of paragraph 3 of subsection

S769 - Bill Text download pdf


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

                                   769

                       2019-2020 Regular Sessions

                            I N  S E N A T E

                               (PREFILED)

                             January 9, 2019
                               ___________

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  permitting  certain
  insurance  coverage  to  be placed by licensed excess line broker with
  unauthorized insurers without regard to the diligent  effort  require-
  ment  and  simplifying  the  excess line insurance placement affidavit
  requirements

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

  Section  1.  Subparagraph  (A)  of  paragraph  3  of subsection (b) of
section 2118 of the insurance law, as amended by section 12 of part I of
chapter 61 of the laws of 2011, is amended to read as follows:
  (A) Except as provided in subparagraph (F) AND SUBJECT TO SUBPARAGRAPH
(C) of this paragraph, submission of insurance documents to  the  excess
line  association shall be accompanied by a statement subscribed to, and
affirmed by, the licensee or sublicensee as true under the penalties  of
perjury  that,  after  diligent  effort,  the  full  amount of insurance
required could not be procured, from authorized insurers, each of  which
is  authorized  to  write  insurance of the kind requested and which the
licensee has reason to believe might consider writing the type of cover-
age or class of insurance involved, and further showing that the  amount
of  insurance  procured  from an unauthorized insurer is only the excess
over the amount procurable from an  authorized  insurer.  The  licensee,
however,  shall  be  excused  from  affirming that a diligent effort, as
defined above, was made to procure the coverage from authorized insurers
if the licensee's affidavit is accompanied by the affidavit  of  another
broker  involved  in the placement affirming as true under the penalties
of perjury that, after diligent effort  by  the  affirming  broker,  the
required  insurance  could  not  be  procured from an authorized insurer
which the affirming broker had reason to believe might consider  writing

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets

                      [ ] is old law to be omitted.
                                                           LBD06625-02-9

S. 769                              2

the  type  of  coverage or class of insurance involved. The licensee and
the affirming broker shall be excused from  affirming  that  a  diligent
effort  was made if the superintendent determines, pursuant to paragraph
four  of  this  subsection,  that no declinations are required. NOTWITH-
STANDING ANYTHING TO THE CONTRARY CONTAINED IN  THIS  CHAPTER,  WHERE  A
RETAIL  INSURANCE  BROKER  SEEKS  TO  PROCURE  OR PLACE COMMERCIAL LINES
INSURANCE THROUGH AN UNAFFILIATED WHOLESALE EXCESS LINE INSURANCE BROKER
AND THE WHOLESALE EXCESS LINE INSURANCE BROKER  SHALL  BE  EXCUSED  FROM
MAKING ANY DILIGENT EFFORT OTHERWISE REQUIRED BY THIS ARTICLE.
  § 2. Subparagraph (C) of paragraph 3 of subsection (b) of section 2118
of  the insurance law, as amended by chapter 684 of the laws of 1993, is
amended to read as follows:
  (C) Every licensee, or affirming broker, in connection with the place-
ment of each risk pursuant to this section NOT OTHERWISE EXEMPT FROM THE
DILIGENT EFFORT REQUIREMENT, shall  record  on  the  affidavit  required
pursuant  to  subparagraph  (A)  of this paragraph the NAME AND NATIONAL
ASSOCIATION OF INSURANCE COMMISSIONERS (NAIC) CODE  OF  EACH  AUTHORIZED
INSURER  DECLINING  A  RISK  AND information relied upon that formed the
basis of such licensee's or affirming broker's reason  to  believe  that
the  authorized  insurer  might consider writing the type of coverage or
class of insurance involved.  NO ADDITIONAL DILIGENT EFFORT  INFORMATION
SHALL BE REPORTED ON ON THE AFFIDAVIT.
  §  3.  Section  2119  of  the insurance law is amended by adding a new
subsection (g) to read as follows:
  (G) (1) FOR THE PURPOSES OF THIS SECTION:
  (A) A "RETAIL INSURANCE BROKER" MEANS AN INSURANCE BROKER LICENSEE WHO
DIRECTLY DEALS WITH AN INSURED;
  (B) A "WHOLESALE EXCESS LINE  INSURANCE  BROKER"  MEANS  THE  LICENSED
EXCESS LINE INSURANCE BROKER FROM WHOM OR THROUGH WHOM THE RETAIL INSUR-
ANCE  BROKER HAS PROCURED EXCESS LINE COVERAGE ON BEHALF OF THE INSURED;
AND
  (C) "COMMERCIAL LINES INSURANCE" MEANS ANY  POLICY  OF  INSURANCE  NOT
DEFINED  AS  A "COVERED POLICY" IN SUBSECTION (A) OF SECTION THREE THOU-
SAND FOUR HUNDRED TWENTY-FIVE OF THIS CHAPTER.
  (2) A RETAIL INSURANCE BROKER AND A WHOLESALE  EXCESS  LINE  INSURANCE
BROKE ARE UNAFFILIATED IF ONE DOES NOT CONTROL, IS NOT CONTROLLED BY, OR
IS  NOT  UNDER  COMMON  CONTROL WITH THE OTHER. ONE HAS CONTROL OVER THE
OTHER IF THE BROKER DIRECTLY OR INDIRECTLY OR ACTING THROUGH ONE OR MORE
OTHER PERSONS OWNS, CONTROLS, OR  HAS  THE  POWER  TO  VOTE  TWENTY-FIVE
PERCENT  OR  MORE  OF  ANY  CLASS  OF VOTING SECURITIES OF THE OTHER; OR
CONTROLS IN ANY MANNER THE ELECTION OF A MAJORITY OF  THE  DIRECTORS  OR
TRUSTEES OF THE OTHER.
  §  4.  This act shall take effect immediately, provided, however, that
the amendments to subparagraphs (A) and (C) of paragraph 3 of subsection
(b) of section 2118 of the insurance law made by sections one and two of
this act shall not affect the expiration of such paragraph and shall  be
deemed to expire therewith.

Co-Sponsors

S769A (ACTIVE) - Details

See Assembly Version of this Bill:: A8842
Current Committee:: Assembly Insurance
Law Section:: Insurance Law
Laws Affected:: Amd §2118, Ins L
Versions Introduced in 2021-2022 Legislative Session:: S498, A5241

S769A (ACTIVE) - Summary

S769A (ACTIVE) - Sponsor Memo

 
BILL NUMBER: S769A

SPONSOR: BRESLIN
 
TITLE OF BILL:  An act to amend the insurance law, in relation to
permitting certain insurance coverage to be placed by licensed excess
line broker with unauthorized insurers without regard to the diligent
effort requirement and simplifying the excess line insurance placement
affidavit requirements

 
PURPOSE:

To exempt commercial lines insurance transactions placed by wholesale
insurance brokers from the excess line diligent effort requirement, and
streamline the excess line affidavit regarding declinations that is
filed by insurance brokers when placing excess line business.

 
SUMMARY OF PROVISIONS:

Section 1. Subparagraph (A) of paragraph 3 of subsection (b) of section
2118 of the insurance law, as amended by section 12 of part I of chapter
61 of the laws of 2011 is amended to exempt commercial lines insurance

transactions placed by both the resale insurance broker and the whole-
sale insurance broker from the excess line diligent effort requirement.

Section 2. Subparagraph (C) of paragraph 3 of subsection (b) of section
2118 of the insurance law, as amended by chapter 684 of the laws of 1993
is amended to specify the diligent effort requirements under this legis-
lation.

Section 3. Section 2118 of the insurance law is amended by adding a new
subsection (g) to define "retail insurance broker," "wholesale excess
line insurance broker," and "commercial lines insurance."

(2) Specifies the allowable affiliation between the retail insurance
broker and a wholesale excess line insurance broker for the purposes of
this section.

Section 4. Effective Date

 
JUSTIFICATION:

This legislation would expedite service to insureds while maintaining
the state's ability to protect consumers. The excess line market exists
to insure risks which New York admitted insurers choose not to under-
write because the risks are distressed, unique, volatile, or involve new
businesses or coverages without loss history. The market is of vital
importance to New York and nimble processing is essential to effectively
serve consumer needs.

Approximately 17% of New York licensed insurance brokers place excess
line business through wholesale brokers for an annual average of twen-
ty-five transactions each. This is a strong indicator that retailers
only go to wholesalers when the retailers admitted markets refuse to
insure a risk.

However, the more complicated the affidavit, the more burdensome and
time consuming it is for the wholesale excess line insurance broker to
obtain it from the retail insurance broker for filing with ELANY.  This

can lead to unnecessary delayed transactions which is to the consumer's
detriment.

New York is one of only ten states that require the filing of declina-
tion information, and the only state that requires twenty-one elements
in total for three separate declinations.

Insurance brokers would still be required to file insurance coverage
documents and affidavits with the Excess Line Association of New York
(ELANY) and all elements would still be available to the Department of
Financial Services upon request.

 
LEGISLATIVE HISTORY:

This is a new bill.

 
FISCAL IMPLICATIONS:

None.

 
EFFECTIVE DATE:
This act shall take effect immediately, provided, however, that the
amendments to subparagraphs (A) and (C) of paragraph 3 of subsection (b)
of section 2118 of the insurance law made by sections one and two of
this act shall not affect the expiration of such paragraph and shall be
deemed to expire therewith.

S769A (ACTIVE) - Bill Text download pdf


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

                                 769--A

                       2019-2020 Regular Sessions

                            I N  S E N A T E

                               (PREFILED)

                             January 9, 2019
                               ___________

Introduced  by  Sens. BRESLIN, BROOKS -- read twice and ordered printed,
  and when printed to be committed to  the  Committee  on  Insurance  --
  committee  discharged,  bill amended, ordered reprinted as amended and
  recommitted to said committee

AN ACT to amend the insurance law, in  relation  to  permitting  certain
  insurance  coverage  to  be placed by licensed excess line broker with
  unauthorized insurers without regard to the diligent  effort  require-
  ment  and  simplifying  the  excess line insurance placement affidavit
  requirements

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

  Section  1.  Subparagraph  (A)  of  paragraph  3  of subsection (b) of
section 2118 of the insurance law, as amended by section 12 of part I of
chapter 61 of the laws of 2011, is amended to read as follows:
  (A) Except as provided in subparagraph (F) AND SUBJECT TO SUBPARAGRAPH
(C) of this paragraph, submission of insurance documents to  the  excess
line  association shall be accompanied by a statement subscribed to, and
affirmed by, the licensee or sublicensee as true under the penalties  of
perjury  that,  after  diligent  effort,  the  full  amount of insurance
required could not be procured, from authorized insurers, each of  which
is  authorized  to  write  insurance of the kind requested and which the
licensee has reason to believe might consider writing the type of cover-
age or class of insurance involved, and further showing that the  amount
of  insurance  procured  from an unauthorized insurer is only the excess
over the amount procurable from an  authorized  insurer.  The  licensee,
however,  shall  be  excused  from  affirming that a diligent effort, as
defined above, was made to procure the coverage from authorized insurers
if the licensee's affidavit is accompanied by the affidavit  of  another
broker  involved  in the placement affirming as true under the penalties
of perjury that, after diligent effort  by  the  affirming  broker,  the

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets

                      [ ] is old law to be omitted.
                                                           LBD06625-03-9

S. 769--A                           2

required  insurance  could  not  be  procured from an authorized insurer
which the affirming broker had reason to believe might consider  writing
the  type  of  coverage or class of insurance involved. The licensee and
the  affirming  broker  shall  be excused from affirming that a diligent
effort was made if the superintendent determines, pursuant to  paragraph
four  of  this  subsection,  that no declinations are required. NOTWITH-
STANDING ANYTHING TO THE CONTRARY CONTAINED IN  THIS  CHAPTER,  WHERE  A
RETAIL  INSURANCE  BROKER  SEEKS  TO  PROCURE  OR PLACE COMMERCIAL LINES
INSURANCE  THROUGH  AN  UNAFFILIATED  WHOLESALE  EXCESS  LINE  INSURANCE
BROKER,  BOTH  THE RETAIL INSURANCE BROKER AND THE WHOLESALE EXCESS LINE
INSURANCE BROKER SHALL BE EXCUSED FROM MAKING ANY DILIGENT EFFORT OTHER-
WISE REQUIRED BY THIS ARTICLE.
  § 2. Subparagraph (C) of paragraph 3 of subsection (b) of section 2118
of the insurance law, as amended by chapter 684 of the laws of 1993,  is
amended to read as follows:
  (C) Every licensee, or affirming broker, in connection with the place-
ment of each risk pursuant to this section NOT OTHERWISE EXEMPT FROM THE
DILIGENT  EFFORT  REQUIREMENT,  shall  record  on the affidavit required
pursuant to subparagraph (A) of this paragraph  the  NAME  AND  NATIONAL
ASSOCIATION  OF  INSURANCE  COMMISSIONERS (NAIC) CODE OF EACH AUTHORIZED
INSURER DECLINING A RISK AND information relied  upon  that  formed  the
basis  of  such  licensee's or affirming broker's reason to believe that
the authorized insurer might consider writing the type  of  coverage  or
class  of insurance involved.  NO ADDITIONAL DILIGENT EFFORT INFORMATION
SHALL BE REPORTED ON THE AFFIDAVIT.
  § 3. Section 2118 of the insurance law is  amended  by  adding  a  new
subsection (g) to read as follows:
  (G) (1) FOR THE PURPOSES OF THIS SECTION:
  (A) A "RETAIL INSURANCE BROKER" MEANS AN INSURANCE BROKER LICENSEE WHO
DIRECTLY DEALS WITH AN INSURED;
  (B)  A  "WHOLESALE  EXCESS  LINE  INSURANCE BROKER" MEANS THE LICENSED
EXCESS LINE INSURANCE BROKER FROM WHOM OR THROUGH WHOM THE RETAIL INSUR-
ANCE BROKER HAS PROCURED EXCESS LINE COVERAGE ON BEHALF OF THE  INSURED;
AND
  (C)  "COMMERCIAL  LINES  INSURANCE"  MEANS ANY POLICY OF INSURANCE NOT
DEFINED AS A "COVERED POLICY" IN SUBSECTION (A) OF SECTION  THREE  THOU-
SAND FOUR HUNDRED TWENTY-FIVE OF THIS CHAPTER.
  (2)  A  RETAIL  INSURANCE BROKER AND A WHOLESALE EXCESS LINE INSURANCE
BROKE ARE UNAFFILIATED IF ONE DOES NOT CONTROL, IS NOT CONTROLLED BY, OR
IS NOT UNDER COMMON CONTROL WITH THE OTHER. ONE  HAS  CONTROL  OVER  THE
OTHER IF THE BROKER DIRECTLY OR INDIRECTLY OR ACTING THROUGH ONE OR MORE
OTHER  PERSONS  OWNS,  CONTROLS,  OR  HAS  THE POWER TO VOTE TWENTY-FIVE
PERCENT OR MORE OF ANY CLASS OF  VOTING  SECURITIES  OF  THE  OTHER;  OR
CONTROLS  IN  ANY  MANNER THE ELECTION OF A MAJORITY OF THE DIRECTORS OR
TRUSTEES OF THE OTHER.
  § 4. This act shall take effect immediately, provided,  however,  that
the amendments to subparagraphs (A) and (C) of paragraph 3 of subsection
(b) of section 2118 of the insurance law made by sections one and two of
this  act shall not affect the expiration of such paragraph and shall be
deemed to expire therewith.

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The New York State Senate

senate Bill S769A

Sponsored By

Archive: Last Bill Status - Passed Senate

Your Voice

Actions

Votes

Mar 11, 2020 - floor Vote

Floor Vote: Mar 11, 2020

Jan 27, 2020 - Insurance committee Vote

Insurance Committee Vote: Jan 27, 2020

May 30, 2019 - floor Vote

Floor Vote: May 30, 2019

Apr 29, 2019 - Insurance committee Vote

Insurance Committee Vote: Apr 29, 2019

Bill Amendments

Co-Sponsors

S769 - Details

S769 - Summary

S769 - Sponsor Memo

S769 - Bill Text download pdf

Co-Sponsors

S769A (ACTIVE) - Details

S769A (ACTIVE) - Summary

S769A (ACTIVE) - Sponsor Memo

S769A (ACTIVE) - Bill Text download pdf

Comments

senate Bill S769A

Share this bill

Sponsored By

Neil D. Breslin

Archive: Last Bill Status - Passed Senate

Your Voice

Actions

Votes

Mar 11, 2020 - floor Vote

Floor Vote: Mar 11, 2020

Jan 27, 2020 - Insurance committee Vote

Insurance Committee Vote: Jan 27, 2020

May 30, 2019 - floor Vote

Floor Vote: May 30, 2019

Apr 29, 2019 - Insurance committee Vote

Insurance Committee Vote: Apr 29, 2019

Bill Amendments

Co-Sponsors

John E. Brooks

S769 - Details

S769 - Summary

S769 - Sponsor Memo

S769 - Bill Text download pdf

Co-Sponsors

John E. Brooks

S769A (ACTIVE) - Details

S769A (ACTIVE) - Summary

S769A (ACTIVE) - Sponsor Memo

S769A (ACTIVE) - Bill Text download pdf

Comments