S T A T E   O F   N E W   Y O R K
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                                  9797

                          I N  A S S E M B L Y

                              May 22, 2014
                               ___________

Introduced by M. of A. WEPRIN -- read once and referred to the Committee
  on Insurance

AN ACT to amend the insurance law, in relation to removing the exemption
  of  the state insurance fund from licensing and other requirements; to
  amend the workers' compensation law,  in  relation  to  requiring  the
  superintendent  of insurance to approve the rules adopted by the state
  insurance fund for the conduct of its business; and to amend the work-
  ers' compensation law, in relation to the requirement for  policyhold-
  ers  to  provide  30  days notice to withdraw from the state insurance
  fund

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

  Section  1.  Section  1108  of  the  insurance  law, subsection (c) as
amended by chapter 838 of the laws of 1985, subsection (j) as  added  by
section 2 of part R of chapter 56 of the laws of 2010, subsection (k) as
added  by  chapter  181  of the laws of 2012, subsection (l) as added by
chapter 246 of the laws  of  2012,  subsection  (l)  as  relettered  and
subsection  (m)  as added by chapter 203 of the laws of 2013, is amended
to read as follows:
  S 1108. Insurers exempt from licensing  and  other  requirements.  The
following  insurers, their officers, agents, representatives and employ-
ees shall be exempt from licensing and other requirements imposed by the
provisions of this chapter (except article seventy-four hereof)  to  the
extent specified below:
  (a)  Any  charitable  annuity society which complies with the require-
ments of section one thousand one hundred ten of this  article,  to  the
extent therein stated.
  (b)  Any  fraternal  benefit  society, membership corporation or other
organization exempted under the provisions of article forty-five of this
chapter, to the extent therein stated.
  [(c) The state  insurance  fund  of  this  state,  except  as  to  the
provisions of subsection (d) of section two thousand three hundred thir-
ty-nine,  section  three thousand one hundred ten, subsection (a), para-
graph one of subsection (b),  paragraph  three  of  subsection  (c)  and

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

                                                           LBD14064-01-4

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subsection (d) of section three thousand two hundred one, sections three
thousand  two  hundred two, three thousand two hundred four, subsections
(a) through (d)  of  section  three  thousand  two  hundred  twenty-one,
subsections  (b)  and  (c)  of section four thousand two hundred twenty-
four, section four thousand two hundred twenty-six and  subsections  (a)
and  (b)  and (g) through (j) of section four thousand two hundred thir-
ty-five of this chapter and except as otherwise specifically provided by
the laws of this state.
  (d)] (C) Any corporate trustee or board of trustees acting pursuant to
the banking law in relation to the fund for  insurance  of  deposits  in
savings  banks  or  the fund for insurance of shares of savings and loan
associations.
  [(e)] (D) Any corporation, organized under  the  laws  of  any  state,
solely  to  provide  gratuitously  for support or relief of the priests,
clergy or ministers of any religious denomination, or their  dependents,
is  exempt  from  all  provisions  of this chapter, except that any such
corporation, created by special act  of  incorporation  of  this  state,
which  by  the  provisions  of such act is subject to the requirement of
examination by, and making annual reports to, the superintendent,  shall
be  subject  to the provisions of article three of this chapter relating
to examinations and statements or reports by insurers.
  [(f)] (E) Any retirement system or pension fund that was  doing  busi-
ness  on  January first, nineteen hundred forty under the education law,
the civil service law, the mental hygiene law, any special act of incor-
poration of this state, or any municipal charter adopted under the  laws
of this state, exclusively for the benefit of the members of such system
or  fund or for all or any classes of the employees of this state or any
municipality thereof, shall be exempt from the provisions of this  chap-
ter,  except  that if the law under which such system or fund was organ-
ized subjects it to examination by, and the making of annual reports to,
the superintendent,  such  system  or  fund  shall  be  subject  to  the
provisions of article three of this chapter relating to examinations and
statements or reports by insurers.
  [(g)]  (F)  Any membership corporation or voluntary association organ-
ized and operating in  this  state  prior  to  January  first,  nineteen
hundred thirty-nine and its members may act as indemnitors of a licensed
property/casualty  insurance company in respect to surety bonds or poli-
cies of insurance required to be  filed  by  such  members  pursuant  to
section  three  hundred  seventy  of the vehicle and traffic law and are
exempted from the requirement of having an  insurer's  license;  but  no
such  membership corporation or association shall become a surety on any
such bond or otherwise do an insurance business.
  [(h)] (G) Any relief department or pension plan of any common  carrier
subject  to  the [the] Railroad Retirement Act of 1974 (45 U.S.C. S 31),
whose privileges and membership are  confined  to  employees  or  former
employees  of such carrier or its affiliated or subsidiary companies, or
to any association of such common carriers which  administers  any  such
department or plan.
  [(i)] (H) Every blood credit system established by a city, pursuant to
section twenty-one-d of the general city law.
  [(j)]  (I)  Any  group of employers authorized by the workers' compen-
sation board to provide workers' compensation benefits for the employees
of all member employers pursuant to subdivision three-a of section fifty
of the workers' compensation law.

A. 9797                             3

  [(k)] (J) A charitable bail organization holding a certificate  issued
by  the  superintendent  pursuant  to section six thousand eight hundred
five of this chapter.
  [(l)]  (K) An institution of higher education, as defined in paragraph
two of subsection (a) of section one thousand one hundred twenty-four of
this article, that has a certificate of authority from  the  superinten-
dent  and  complies  with  the  requirements of section one thousand one
hundred twenty-four of this article, to the extent therein stated.
  [(m)] (L) A freelancers association, as defined in section  one  thou-
sand one hundred twenty-five of this article, that obtains and maintains
a demonstration program waiver from the superintendent and complies with
the requirements of section one thousand one hundred twenty-five of this
article, to the extent therein stated.
  S  2.  Paragraph  2 of subsection (a) of section 4522 of the insurance
law is amended to read as follows:
  (2) Organizations which limit their membership to the employees  of  a
particular  city  or  town,  or  of a designated business corporation or
firm, or of one or more business corporations or firms  having  business
interests  in  common,  except as otherwise provided in subsection [(f)]
(E) of section one thousand one hundred eight of this chapter. Any  such
organization  which  limits  its membership to the employees of a corpo-
ration having more than five thousand employees may provide  for  hospi-
tal,  surgical and medical benefits for the employee, his or her spouse,
and his or her child or children not over eighteen years of age.
  S 3. Section 83 of the workers' compensation law, as amended by  chap-
ter 34 of the laws of 2010, is amended to read as follows:
  S  83.  Rules.  The [commissioner] COMMISSIONERS shall adopt rules for
the conduct of the business of the state fund, and may from time to time
alter, amend or repeal any rule therefore adopted. At least six affirma-
tive votes shall be required for the adoption of any rule, or the amend-
ment or repeal of any rule. No rule,  and  no  resolution  proposing  to
alter,  amend  or repeal any rule, shall be effective unless approved by
the [commissioner of labor. If the commissioner of labor  fails  to  act
upon any such rule or resolution within thirty days after it is communi-
cated  to  him  or  her, such rule or resolution shall be deemed to have
been approved] SUPERINTENDENT OF INSURANCE.
  The rules of the commissioners shall provide for the  conduct  of  the
business of the state insurance fund, including the issuance of policies
and their terms and conditions, the fixing of premium rates, the keeping
of  records,  auditing  of  payrolls,  and the billing and collection of
premiums therefor, the inspection of risks and the setting of the stand-
ards of safety, the adjustment and payment of claims and awards, and the
investigation of all matters relating thereto, the  medical  examination
of  persons  claiming compensation and the furnishing and supervision of
medical and surgical treatment to persons injured as set forth  in  this
chapter,  the conduct of the legal business of the fund and the enforce-
ment of the subrogated rights of the fund  against  third  parties,  the
investment  of  the surplus and reserves of the fund, and the collection
and analysis of statistics of payrolls, premiums,  losses  and  expenses
and the actuarial consideration thereof.
  S  4. Subdivision a of section 94 of the workers' compensation law, as
amended by chapter 635 of the laws  of  1996,  is  amended  to  read  as
follows:
  a.  Any  employer may, upon complying with subdivision two or three of
section fifty of this chapter, withdraw from the fund by turning in  his
insurance  contract  for  cancellation,  [provided  he has given written

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notice to the fund of his intention to withdraw  not  less  than  thirty
days  before the effective date of such cancellation] ALONG WITH WRITTEN
NOTICE OF THE EFFECTIVE DATE OF THE CANCELLATION. Upon receipt  of  such
notice  the  fund shall[, at least ten days prior to the effective date]
file in the office of the chairman a notice of such cancellation date.
  [In no event shall the insurance contract be deemed cancelled until at
least ten days after the date of such filing, any earlier date mentioned
in the notice to the contrary notwithstanding.]
  If an employer withdraws from the fund upon complying with subdivision
two of section fifty of this chapter, the new  insurance  contract  with
the stock corporation, mutual corporation or reciprocal insurer shall be
deemed  not  to  take  effect  until the cancellation of such employer's
contract with the state insurance fund has become effective.
  S 5. This act shall take effect on the ninetieth day  after  it  shall
have  become  a law; provided that the amendments to subsections (l) and
(m) of section 1108 of the insurance law made by section one of this act
shall not affect the expiration of subsection  (l)  and  the  repeal  of
subsection (m) and shall expire and be deemed repealed therewith.