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March 24, 2014
PIWA President Maya Cruz and Legislative Chair Wil Cote, along with legislative representative Bob Pastel, spent two days lobbying on PIWA's behalf in Albany. They met with Senator Seward, Chair of the Senate Insurance Committee; Kevin Cahill, Chair of the Assembly Insurance Committee, Assembly Speaker Staff, Ranking Senate Insurance Committee member of Neil Breslin's office, and Department of Financial Services legislative counsel and assistant counsel. PIWA will be working with its retail producers and ELANY to help reduce onerous and outdated paperwork requirements and modernize and update the excess line broker duties.
Some of the key issues that PIWA leadership discussed are as follows:
Reform 11 NYCRR Part 27 (Regulation 41) to presume due care when an excess line broker places coverage with any insurer listed with ELANY.
Currently the standard requires the broker to ascertain the insurer's financial stability as well as the insurer's capacity to support the business for which it underwrites. The broker must also verify the insurer's claims practices and vouch for its management practices. This regulation should be reformed to presume that due care has been exercised when it places coverage with any insurer that is recognized by ELANY.
PIWA also supports the following statutory change: §2118 Excess line brokers; duties (a) (1) Every licensee licensed pursuant to section two thousand one hundred five of this article shall be required to use due care in selecting the unauthorized insurer from whom policies are procured under his or her license. Reliance on the list of eligible insurers promulgated by excess line association of New York established pursuant to section 2130 shall satisfy this requirement.
Modify 11 NYCRR Part 27 (Regulation 41) to allow the "diligent search" requirement to be valid for 36 months.
Currently, excess line brokers must provide 21 data elements in an affidavit as part of a diligent search requirement mandated each year. This amounts to a burdensome, time consuming process. As a substantial percentage of accounts renew each year, the annual "diligent search" only yields a minimal amount of new information. It would be more appropriate to require a "diligent search" every 36 months.
Streamline the affidavit process by removing unnecessary and onerous reporting requirements.
No other state has the 21 data elements that NY requires in the affidavit process. PIWA recommends that this be streamlined and modernized to meet its intended purpose.
Support certificate of insurance reform legislation
S6545 by Senator Seward (on Senate Floor). Insurance producers are often asked by insurance policyholders to modify the terms of insurance through a certificate of insurance. These additional terms are often requested by third parties such as municipalities and state agencies. This legislation will assist retail producers by providing clear rules to follow regarding certificates of insurance.
