senate Bill S5585

2021-2022 Legislative Session

Relates to unfair claim settlement practices

download bill text pdf

Sponsored By

Current Bill Status - In Senate Committee Insurance Committee


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

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Actions

view actions (1)
Assembly Actions - Lowercase
Senate Actions - UPPERCASE
Mar 11, 2021 referred to insurance

S5585 (ACTIVE) - Details

See Assembly Version of this Bill:
A6811
Current Committee:
Senate Insurance
Law Section:
Insurance Law
Laws Affected:
Add §2601-a, Ins L
Versions Introduced in Other Legislative Sessions:
2011-2012: S4735
2013-2014: S2544
2015-2016: S29, A8025
2017-2018: S242, A921
2019-2020: S5336, A2822

S5585 (ACTIVE) - Summary

Provides that an insurer doing business in this state shall be liable to a policy holder for such insurer's refusal to pay or unreasonable delay of payment to the policy holder if such refusal or delay was not substantially justified; enumerates instances whereby an insurer's refusal or delay of payment is not substantially justified including intentional negligence, failure to act in good faith, failure to provide written denial of claim, failure to make final determination of claim within six months, and failure to promptly proceed with the appraisal process.

S5585 (ACTIVE) - Sponsor Memo

S5585 (ACTIVE) - Bill Text download pdf

 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   5585
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                              March 11, 2021
                                ___________
 
 Introduced  by  Sen.  COMRIE -- 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 unfair  claim  settle-
   ment practices
 
   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 2601-a
 to read as follows:
   § 2601-A. UNFAIR CLAIM SETTLEMENT  PRACTICES;  CIVIL  REMEDY.  (A)  AN
 INSURER  DOING BUSINESS IN THIS STATE SHALL BE LIABLE TO THE HOLDER OF A
 POLICY ISSUED OR RENEWED PURSUANT TO ARTICLE THIRTY-FOUR OF THIS CHAPTER
 FOR DAMAGES AS PROVIDED IN THIS SECTION UPON SUCH POLICY HOLDER  PROVING
 BY A PREPONDERANCE OF THE EVIDENCE THAT SUCH INSURER'S REFUSAL TO PAY OR
 UNREASONABLE DELAY IN PAYMENT TO THE POLICY HOLDER OF AMOUNTS CLAIMED TO
 BE  DUE  UNDER  A POLICY WAS NOT SUBSTANTIALLY JUSTIFIED.  AN INSURER IS
 NOT SUBSTANTIALLY JUSTIFIED IN REFUSING TO PAY OR IN UNREASONABLY DELAY-
 ING PAYMENT WHEN THE INSURER:
   (1) INTENTIONALLY, RECKLESSLY OR BY GROSS NEGLIGENCE FAILED TO PROVIDE
 THE POLICY HOLDER WITH ACCURATE INFORMATION CONCERNING POLICY PROVISIONS
 RELATING TO THE COVERAGE AT ISSUE;
   (2) FAILED TO EFFECTUATE IN GOOD FAITH A PROMPT,  FAIR  AND  EQUITABLE
 SETTLEMENT OF A CLAIM SUBMITTED BY SUCH POLICY HOLDER IN WHICH LIABILITY
 OF SUCH INSURER TO SUCH POLICY HOLDER WAS REASONABLY CLEAR;
   (3)  FAILED  TO  PROVIDE  A TIMELY WRITTEN DENIAL OF A POLICY HOLDER'S
 CLAIM WITH A FULL AND COMPLETE EXPLANATION  OF  SUCH  DENIAL,  INCLUDING
 REFERENCES TO SPECIFIC POLICY PROVISIONS WHEREVER POSSIBLE;
   (4)  FAILED TO MAKE A FINAL DETERMINATION AND NOTIFY THE POLICY HOLDER
 IN WRITING OF ITS POSITION ON BOTH  LIABILITY  FOR,  AND  THE  INSURER'S
 VALUATION OF, A CLAIM WITHIN SIX MONTHS OF THE DATE ON WHICH IT RECEIVED
 ACTUAL OR CONSTRUCTIVE NOTICE OF THE LOSS UPON WHICH THE CLAIM IS BASED;
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD06480-01-1

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