The New York State Legislature’s 2016 Legislative Session on June 18, 2016 enacted new pieces of legislation affecting the New York insurance industry and also saw proposed pieces of legislation die in the process. In particular, e-delivery legislation passed through both houses, which will now allow for the electronic delivery of insurance notices and electronic posting of insurance policies in the state of New York. Numerous industry participants, including Property Casualty Insurers Association of America (“PCI”) supported this legislation, hoping that the continued reliance on electronic delivery will promote efficiency and decrease transactional costs. In addition, a bill was passed by both houses to establish the State Insurance Advisory Board (the “Board”) within the New York Department of Financial Services (the “NYDFS”) in an effort to grow the insurance sector in New York. Some insurance groups, such as PCI, hope that the Board will steer the NYDFS away from prosecutorial action and more toward industry promotion.
In addition, a few high-profile bills failed to pass both houses. In particular, the trial bar had proposed a bad faith bill which would have established a private right of action for unfair trade practices violations; however, the trial bar did not aggressively pursue the bill and as such the bill did not pass. Other bills relating to transportation network company legislation, auto insurance, coastal homeowners insurance and restrictions on underwriting were defeated as well.
We will continue to report on the status of New York legislative developments and the impact these initiatives may have on the insurance industry.