§ 2123. Misrepresentations, misleading statements and incomplete
comparisons. (a) (1) No agent or representative of any insurer or health
maintenance organization authorized to transact life, accident or health
insurance or health maintenance organization business in this state,
insurance broker, person who has received a grant from and has been
certified by the health benefit exchange established pursuant to section
1311 of the Affordable Care Act, 42 U.S.C. § 18031, to act as a
navigator, including any person employed by a certified navigator, or
other person, firm, association or corporation, shall issue or circulate
or cause or permit to be issued or circulated, any illustration,
circular, statement or memorandum misrepresenting the terms, benefits or
advantages of any policy or contract of life, accident or health
insurance, any annuity contract or any health maintenance organization
contract, delivered or issued for delivery or to be delivered or issued
for delivery, in this state, or shall make any misleading estimate as to
the dividends or share of surplus or additional amounts to be received
in the future on such policy or contract, or shall make any false or
misleading statement as to the dividends or share of surplus or
additional amounts previously paid by any such insurer or health
maintenance organization on similar policies or contracts, or shall make
any misleading representation, or any misrepresentation, as to the
financial condition of any such insurer or health maintenance
organization, or as to the legal reserve system upon which such insurer
or health maintenance organization operates.

(2) No such person, firm, association or corporation shall make to any
person or persons any incomplete comparison of any such policies or
contracts of any insurer, insurers, or health maintenance organization,
for the purpose of inducing, or tending to induce, such person or
persons to lapse, forfeit or surrender any insurance policy or health
maintenance organization contract.

(3) Any replacement of individual life insurance policies or
individual annuity contracts of an insurer by an agent, representative
of the same or different insurer or broker shall conform to standards
promulgated by regulation by the superintendent. Such regulation shall:

(A) specify what constitutes the replacement of a life insurance
policy or annuity contract and the proper disclosure and notification
procedures to replace a policy or contract;

(B) require notification of the proposed replacement to the insurer
whose policies or contracts are intended to be replaced;

(C) require the timely exchange of illustrative and cost information
required by section three thousand two hundred nine of this chapter and
necessary for completion of a comparison of the proposed and replaced
coverage; and

(D) provide for a sixty-day period following issuance of the
replacement policies or contracts during which the policy or contract
owner may return the policies or contracts and reinstate the replaced
policies or contracts.

(b) Any comparison of the policies or contracts of any such insurer,
insurers or health maintenance organization shall be deemed to be an
incomplete comparison if it does not conform to all the requirements for
comparisons established by regulation.

(c) In the determination, judicial or otherwise, of the incompleteness
or misleading character of any such comparison, it shall not be presumed
that the insured knew or knows of any of the provisions, terms or
benefits contained in any insurance policy or health maintenance
organization contract.

(d) Any agent or representative of an insurer or health maintenance
organization, insurance broker, person who has received a grant from and
has been certified by the health benefit exchange established pursuant
to section 1311 of the affordable care act, 42 U.S.C. § 18031, to act as
a navigator, including any person employed by a certified navigator, or
any other person, firm, association or corporation who, or which, shall
violate any of the provisions of this section and shall knowingly
receive any compensation or commission for the solicitation, sale or
negotiation of any insurance policy, health maintenance organization or
annuity contract induced by a violation of this section shall also be
liable for a civil penalty in the amount received by such violator as
compensation or commission, which penalty may be sued for and recovered
for his, her, or its own use and benefit by any person induced to
purchase an insurance policy, health maintenance organization or annuity
contract by such violation. In addition, such agent, representative,
broker, person, firm, association or corporation violating this section
shall be liable for a civil penalty in the amount of any compensation or
commission lost by any agent, representative or broker as a result of a
violation of this section or the making of such false or misleading
statement, which penalty may be sued for and recovered for his, her, or
its own use and benefit by such agent, representative or broker.

* (e) Except with respect to a credit unemployment insurance policy,
group credit life insurance policy, a group credit health, group credit
accident or group credit health and accident policy, or similar group
credit insurance covering the person of the insured, state chartered
banking institutions, federally chartered banking institutions and any
person soliciting the purchase of or selling insurance on the premises
thereof, must disclose or cause to be disclosed in writing, where
practicable, in clear and concise language, to their customers and
prospective customers who are solicited therefor, that any insurance
offered or sold:

(1) is not a deposit;

(2) is not insured by the federal deposit insurance corporation or the
national credit union share insurance fund, as applicable; and

(3) is not guaranteed by the state chartered banking institution or
the federally chartered banking institution.

* NB Repealed September 10, 2024

* (f) For the purposes of this section, the terms "state chartered
banking institutions" and "federally chartered banking institutions"
shall have the same meanings as set forth in subdivision one of section
twelve-a of the banking law.

* NB Repealed September 10, 2024