Both houses of the New York State legislature passed a bill proposing to reverse the longstanding New York rule that an insurer need not establish prejudice in order to disclaim coverage based upon late notice. Bill number S.6306, sponsored by Senator DeFransisco and co-sponsored by Senators Golden and Maltese, would effectively prevent insurers from denying coverage on late notice grounds unless the insurer can demonstrate that it suffered “material prejudice” as a result of the insured’s delayed notice.
The bill is currently before New York state Governor Elliot Spitzer, awaiting his signature.
Click here to review the text of the proposed legislation.
