S T A T E   O F   N E W   Y O R K
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                                  9282

                          I N  A S S E M B L Y

                            February 14, 2012
                               ___________

Introduced by M. of A. DINOWITZ -- read once and referred to the Commit-
  tee on Insurance

AN  ACT to amend the insurance law, in relation to the timing for giving
  notice of a loss under insurance contracts

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  Section  3407 of the insurance law is amended by adding a
new subsection (c) to read as follows:
  (C) (1) ANY PROVISION CONTAINED IN AN  INSURANCE  CONTRACT  ISSUED  OR
DELIVERED  IN  THIS  STATE  OR COVERING A PROPERTY IN THIS STATE THAT IS
CONTRARY IN PURPOSE WITH, OR IN CONFLICT WITH  THE  PROVISIONS  OF  THIS
SECTION  SHALL  BE  NULL  AND VOID IF THE EFFECTUATION OF SUCH PROVISION
WOULD RESULT IN THE DEROGATION OF THE BENEFIT TO AN INSURED INTENDED  BY
THE ENACTMENT OF THIS SECTION.
  (2)  AN INSURER SHALL NOT DENY COVERAGE FOR A CLAIM BASED ON THE FAIL-
URE OF AN INSURED TO GIVE TIMELY NOTICE OF A CLAIM UNLESS THE AUTHORIZED
INSURER OR OTHER INSURER CAN DEMONSTRATE THAT IT HAS  SUFFERED  SUBSTAN-
TIAL  PREJUDICE  AS  A  RESULT  OF THE DELAYED NOTICE. EVIDENCE THAT THE
INSURER HAD KNOWLEDGE OF THE LOSS THAT IS THE SUBJECT OF THE CLAIM SHALL
CREATE A REBUTTABLE PRESUMPTION THAT THE INSURER HAS NOT BEEN PREJUDICED
BY DELAYED NOTICE. NOTICE GIVEN TO ANY LICENSED AGENT OF THE INSURER  IN
THIS  STATE WITH PARTICULARS SUFFICIENT TO IDENTIFY THE INSURED SHALL BE
DEEMED NOTICE TO THE INSURER.
  (3) THE PROVISIONS OF THIS SECTION SHALL  BE  LIBERALLY  CONSTRUED  IN
ORDER  TO EFFECTUATE THE PURPOSE HEREOF WHICH IS TO MITIGATE AGAINST THE
POTENTIAL FOR PROCEDURAL  DENIAL  OF  INSURANCE  COVERAGE  RESULTING  IN
UNREASONABLE LOSS OF INSURANCE PROTECTION FOR INSUREDS.
  S 2. Severability clause. If any clause, sentence, paragraph, subdivi-
sion,  section  or  part  of  this act shall be adjudged by any court of
competent jurisdiction to be invalid, such judgment  shall  not  affect,
impair or invalidate the remainder thereof, but shall be confined in its
operation  to  the  clause, sentence, paragraph, subdivision, section or
part thereof directly involved in the controversy in which such judgment
shall have been rendered. It is hereby declared to be the intent of  the

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
              

                                                           LBD10913-01-1

A. 9282                             2

legislature  that  this act would have been enacted even if such invalid
provisions had not been included herein.
  S  3.  This  act shall take effect immediately, and shall apply to all
insurance contracts, executed, issued, reissued or renewed on  or  after
such date.