S T A T E O F N E W Y O R K
________________________________________________________________________
498
2021-2022 Regular Sessions
I N A S S E M B L Y
(PREFILED)
January 6, 2021
___________
Introduced by M. of A. CARROLL, DINOWITZ, GOTTFRIED, SEAWRIGHT, THIELE,
ANDERSON, PHEFFER AMATO, SIMON -- read once and referred to the
Committee on Insurance
AN ACT to amend the insurance law, in relation to requiring business
interruption insurance to cover disease outbreaks
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 section 346
to read as follows:
§ 346. BUSINESS INTERRUPTION INSURANCE; DISEASE OUTBREAK. (A) FOR THE
PURPOSES OF THIS SECTION:
(1) "BUSINESS" SHALL MEAN A BUSINESS REGISTERED WITH THE DEPARTMENT OF
TAX AND FINANCE OR NOT-FOR-PROFIT CORPORATION REGISTERED WITH THE ATTOR-
NEY GENERAL'S CHARITIES BUREAU.
(2) "ELIGIBLE EMPLOYEE" SHALL MEAN A FULL-TIME EMPLOYEE WHO WORKS A
NORMAL WORK WEEK OF TWENTY-FIVE OR MORE HOURS.
(3) "INCOME" SHALL MEAN TRADITIONAL BUSINESS INCOME AS WELL AS NOT-
FOR-PROFIT REVENUE FROM DONATIONS, SPONSORSHIPS, AND GRANTS.
(4) "NET WRITTEN PREMIUMS RECEIVED" SHALL MEAN GROSS DIRECT PREMIUMS
WRITTEN, LESS RETURN PREMIUMS THEREON AND DIVIDENDS CREDITED OR PAID TO
POLICYHOLDERS, AS REPORTED ON THE COMPANY'S ANNUAL FINANCIAL STATEMENT.
(5) "PREMIUM TAXES" SHALL MEAN PAYMENTS REQUIRED UNDER SUBSECTION (D)
OF SECTION TWO THOUSAND ONE HUNDRED EIGHTEEN OF THIS CHAPTER.
(B) (1) NOTWITHSTANDING ANY PROVISIONS OF LAW, RULE OR REGULATION TO
THE CONTRARY, EVERY CLAUSE OR PROVISION OF A POLICY OF INSURANCE INSUR-
ING AGAINST LOSS OR DAMAGE TO PROPERTY, WHICH INCLUDES, BUT IS NOT
LIMITED TO, THE LOSS OF USE AND OCCUPANCY AND BUSINESS INTERRUPTION AND
CONTINGENT BUSINESS INTERRUPTION, WHICH ALLOWS THE INSURER TO DENY
COVERAGE BASED ON A VIRUS, BACTERIUM, OR OTHER MICROORGANISM THAT CAUSES
DISEASE, ILLNESS, OR PHYSICAL DISTRESS OR THAT IS CAPABLE OF CAUSING
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD03461-01-1
A. 498 2
DISEASE, ILLNESS, OR PHYSICAL DISTRESS SHALL BE NULL AND VOID AS AGAINST
PUBLIC POLICY; PROVIDED, HOWEVER, THE REMAINING CLAUSES AND PROVISIONS
OF THE CONTRACT SHALL REMAIN IN EFFECT FOR THE DURATION OF THE CONTRACT
TERM.
(2) THE COVERAGE REQUIRED BY THIS SUBSECTION SHALL INDEMNIFY THE
INSURED, SUBJECT TO THE LIMITS UNDER THE POLICY, FOR ANY LOSS OF BUSI-
NESS OR BUSINESS INTERRUPTION AND CONTINGENT BUSINESS INTERRUPTION.
(3) THIS SUBSECTION SHALL APPLY TO POLICIES ISSUED TO INSUREDS WITH
LESS THAN TWO HUNDRED FIFTY ELIGIBLE EMPLOYEES.
(C)(1) AN INSURER, INCLUDING EXCESS LINES INSURERS, WHICH INDEMNIFIES
AN INSURED WHO HAS FILED A CLAIM PURSUANT TO SUBSECTION (B) OF THIS
SECTION MAY APPLY TO THE SUPERINTENDENT FOR RELIEF AND REIMBURSEMENT BY
THE DEPARTMENT FROM FUNDS COLLECTED AND MADE AVAILABLE FOR THIS PURPOSE
AS PROVIDED IN SUBSECTION (D) OF THIS SECTION.
(2) THE SUPERINTENDENT SHALL ESTABLISH PROCEDURES FOR THE SUBMISSION
AND QUALIFICATION OF CLAIMS BY INSURERS WHICH ARE ELIGIBLE FOR
REIMBURSEMENT PURSUANT TO THIS SECTION. THE SUPERINTENDENT SHALL INCOR-
PORATE IN THESE PROCEDURES SUCH STANDARDS AS ARE NECESSARY TO PROTECT
AGAINST THE SUBMISSION OF FRAUDULENT CLAIMS BY INSUREDS, AND APPROPRIATE
SAFEGUARDS FOR INSURERS TO EMPLOY IN THE REVIEW AND PAYMENT OF SUCH
CLAIMS.
(D)(1) THE SUPERINTENDENT IS AUTHORIZED TO IMPOSE UPON, DISTRIBUTE
AMONG, AND COLLECT FROM THE COMPANIES, INCLUDING EXCESS LINES INSURERS,
ENGAGED IN BUSINESS PURSUANT TO THIS CHAPTER, SUCH ADDITIONAL AMOUNTS AS
MAY BE NECESSARY TO RECOVER THE AMOUNTS PAID TO INSURERS PURSUANT TO
SUBSECTION (C) OF THIS SECTION.
(2) THE ADDITIONAL SPECIAL PURPOSE APPORTIONMENT AUTHORIZED PURSUANT
TO PARAGRAPH ONE OF THIS SUBSECTION SHALL BE DISTRIBUTED IN THE PROPOR-
TION THAT THE NET WRITTEN PREMIUMS, OR PREMIUM TAXES IN THE CASE OF
EXCESS LINES INSURERS, RECEIVED BY EACH COMPANY SUBJECT TO THE APPOR-
TIONMENT AUTHORIZED BY THIS SECTION FOR INSURANCE WRITTEN OR RENEWED ON
RISKS IN THIS STATE DURING THE CALENDAR YEAR IMMEDIATELY PRECEDING,
BEARS TO THE SUM TOTAL OF ALL SUCH NET WRITTEN PREMIUMS, OR PREMIUM
TAXES IN THE CASE OF EXCESS LINES INSURERS, RECEIVED BY ALL COMPANIES
WRITING THAT INSURANCE OR COVERAGE WITHIN THE STATE DURING THAT CALENDAR
YEAR, AS REPORTED.
§ 2. This act shall take effect immediately and shall apply to all
business interruption insurance claims filed by an insured and all poli-
cies or contracts issued, renewed, modified, altered or amended on and
after such effective date.