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Assembly Bill A7523

2021-2022 Legislative Session

Requires a liability insurer that has an opportunity to settle a claim at or within the policy limits, and refuses to do so, to be liable for any verdict in excess of the insurance policy limits

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Archive: Last Bill Status - In Assembly Committee

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2021-A7523 (ACTIVE) - Details

Current Committee:
Assembly Insurance
Law Section:
Insurance Law
Laws Affected:
Amd §3420, Ins L
Versions Introduced in Other Legislative Sessions:
2023-2024: A2095
2025-2026: A3889

2021-A7523 (ACTIVE) - Summary

Requires a liability insurer that has an opportunity to settle a claim at or within the policy limits, and refuses to do so, to be liable for any verdict in excess of the insurance policy limits; prohibits the insurer from recovering such excess judgment from the insured.

2021-A7523 (ACTIVE) - Bill Text download pdf 

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7523
 
                        2021-2022 Regular Sessions
 
                           I N  A S S E M B L Y
 
                               May 13, 2021
                                ___________
 
 Introduced  by M. of A. MEEKS -- read once and referred to the Committee
   on Insurance
 
 AN ACT to amend the insurance law, in relation to requiring a  liability
   insurer  that has received an offer to settle a claim at or within the
   policy limits, and refuses to do so, to be liable for any  verdict  in
   excess of such policy limits

   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Subsection (a) of section 3420  of  the  insurance  law  is
 amended by adding a new paragraph 7 to read as follows:
   (7) A PROVISION THAT, IF THE INSURER HAS RECEIVED AN OFFER TO SETTLE A
 CLAIM  AT OR WITHIN THE INSURER'S POLICY LIMITS, AND THE INSURER REFUSES
 TO DO SO, THEREBY EXPOSING THE INSURED TO A VERDICT  IN  EXCESS  OF  THE
 POLICY  LIMITS, THE INSURER SHALL BE LIABLE FOR ANY VERDICT IN EXCESS OF
 THE POLICY LIMITS, NOT LIMITED TO ANY OTHER POLICY  PROVISIONS  AND  NOT
 SUBJECT  TO  THE  LIMITATIONS  AND  CONDITIONS  OF PARAGRAPH TWO OF THIS
 SUBSECTION. SUCH PROVISION SHALL CLEARLY STATE THAT  THE  INSURER  SHALL
 HAVE  NO RIGHT TO SEEK OR RECOVER DAMAGES AGAINST THE INSURED FOR SUCH A
 JUDGMENT RENDERED AGAINST THE INSURER OR THE INSURED.
   § 2. This act shall take effect immediately.
 
 
 
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD11158-03-1

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