BILL NUMBER:A10038

TITLE  OF  BILL:    An  act  to  amend the insurance law, in relation to
approval of certain insurance and annuity policy forms

PURPOSE: This bill would amend the insurance law to  permit  the  Super-
intendent  of  Insurance  to  waive the re-approval of an amended policy
form when the amendment is due to a revision to a separate  account,  so
long as the revision has already been approved by the Department as part
of  the  separate  account plan of operation. Under those circumstances,
such amended policy form would need to  be  filed  on  an  informational
basis  with  the  New York State Insurance Department, within sixty days
after approval of the amended  separate  account  plan.  This  amendment
would  also  give  the  Superintendent  the  discretion  to  waive other
approvals of amended policy forms.

SUMMARY OF PROVISIONS:  This bill establishes a  new  paragraph  (7)  to
53201(b)  of the insurance law to authorize the Superintendent of Insur-
ance to waive the approval of an amended policy form,  so  long  as  the
amendment  had  already  been re-approved by the Insurance Department as
part of a separate account plan of operation and so long as the  amended
form  is  filed with the Insurance Department on an informational basis,
within sixty days after the revised separate account plan  is  approved.
Current  law  is being interpreted so as not to allow the Department any
discretion in waiving the re-approval of these types of  amended  policy
forms.   This  amendment  would  further  give  the  Superintendent  the
              

discretion to waive the approval of any type of amendment  to  a  policy
form.  Current  law  would  not  seem  to  allow the Superintendent this
discretion in this regard.

JUSTIFICATION: Interpretation of the current law has led to the  conclu-
sion by some that the Insurance Department has little discretion when it
comes  to  determining  whether  or not an amendment to a previously-ap-
proved policy form rises to the level  of  needing  re-approval  by  the
Insurance  Department.  This has become an impediment when insurers need
to make simple revisions to policies or contracts, particularly variable
life and annuity contracts that contain  a  separate  account.  Separate
accounts  are mutual fund-type options that are offered as an investment
option under certain variable insurance  products.  These  accounts  are
administered  by  another  company (such as Fidelity or Magellan), which
will routinely make fund revisions (such as,  a  simple  renaming  of  a
fund).  Revisions  to  a  separate  account  under  a variable insurance
contract are already required to be reviewed and reapproved pursuant  to
the  separate account plan of operation required pursuant to 54240(e) of
the Insurance Law. Currently, the  Insurance  Department  also  requires
that  the amended policy form itself must also be reviewed and approved,
in addition to the approval of the  amended  separate  account  plan  of
operation. This dual-track, re-approval process unnecessarily slows down
the  ability  of  insurers to turn around amended forms to the insurance
marketplace. This revision to the law would allow the Superintendent the
discretion to waive approvals  of  amended  policy  forms,  specifically
under the circumstances described above, but also more generally, if the

Department  determines  any amendment is inconsequential enough so as to
not rise to the level of-needing to be re-approved.

PRIOR LEGISLATIVE HISTORY: None.

FISCAL  IMPLICATIONS:  No  known  costs to the State are associated with
this bill.

EFFECTIVE DATE: This act shall take effect sixty  days  after  it  shall
have become a law.