S T A T E   O F   N E W   Y O R K
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                                  6421

                       2015-2016 Regular Sessions

                          I N  A S S E M B L Y

                             March 24, 2015
                               ___________

Introduced  by  M.  of  A. JOYNER, BRINDISI, GOTTFRIED, LINARES, OTIS --
  Multi-Sponsored by -- M.  of A. BLAKE, CLARK,  COOK,  HEVESI,  MOSLEY,
  TITONE -- read once and referred to the Committee on Insurance

AN ACT to amend the insurance law, in relation to verification of claims
  made under the comprehensive motor vehicle insurance reparations act

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

  Section 1. Section 5106  of  the  insurance  law,  subsection  (b)  as
amended  and subsection (d) as added by chapter 452 of the laws of 2005,
is amended to read as follows:
  S 5106. Fair claims settlement. (a) Payments of first  party  benefits
and  additional  first  party  benefits  shall  be  made  as the loss is
incurred.  Such benefits are overdue if  not  paid  within  thirty  days
after  the  claimant  supplies  proof  of  the  fact  and amount of loss
sustained. If proof is not supplied as to the entire claim,  the  amount
which  is  supported  by proof is overdue if not paid within thirty days
after such proof is supplied. All overdue payments shall  bear  interest
at  the  rate  of two percent per month. If a valid claim or portion was
overdue, the claimant shall also be entitled to recover  his  attorney's
reasonable  fee,  for  services necessarily performed in connection with
securing payment of the overdue claim, subject to limitations promulgat-
ed by the superintendent in regulations.
  (b) THE INSURER IS ENTITLED TO RECEIVE ALL ITEMS NECESSARY  TO  VERIFY
THE  CLAIM,  INCLUDING MEDICAL EXAMINATION AND EXAMINATION UNDER OATH OF
THE INJURED PARTY OR ANY ADDITIONAL VERIFICATION REQUIRED BY THE INSURER
TO ESTABLISH PROOF OF CLAIM. THE FAILURE OF THE INJURED PARTY TO  APPEAR
FOR  A  SCHEDULED  MEDICAL  EXAMINATION  OR EXAMINATION UNDER OATH OR TO
PROVIDE ANY OTHER ADDITIONAL VERIFICATION  SHALL  NEITHER  BE  A  POLICY
VIOLATION  NOR  BE  UTILIZED  AS  THE BASIS FOR THE DENIAL OF A CLAIM OR
DISCLAIMER, PROVIDED THE INJURED PARTY SUBMITS TO  THE  INSURER  WRITTEN
PROOF  OFFERING  EITHER  (1) REASONABLE JUSTIFICATION FOR THE FAILURE TO

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09927-01-5
              

A. 6421                             2

COMPLY; OR (2) A DEMONSTRABLE WILLINGNESS TO COMPLY WITHIN THIRTY CALEN-
DAR DAYS FROM THE DATE OF THE INJURED PARTY'S FAILURE TO APPEAR OR OTHER
VERIFICATION BECOMES OVERDUE. IF SUCH  WRITTEN  PROOF  IS  NOT  PROVIDED
WITHIN  A REASONABLE TIME PERIOD, THE INSURER MAY ONLY DENY THAT PORTION
OF THE CLAIM FOR WHICH THE REQUESTED  MEDICAL  EXAMINATION,  EXAMINATION
UNDER  OATH OR ADDITIONAL VERIFICATION WAS REQUIRED AS PROOF OF THE FACT
AND AMOUNT OF LOSS SUSTAINED. IN NO  EVENT  SHALL  THE  FAILURE  OF  THE
INJURED  PARTY TO APPEAR FOR A SCHEDULED MEDICAL EXAMINATION OR EXAMINA-
TION UNDER OATH OR TO PROVIDE ANY OTHER ADDITIONAL VERIFICATION SERVE AS
THE BASIS FOR THE DENIAL OF THAT PORTION OF A CLAIM RELATING TO EMERGEN-
CY MEDICAL CARE PROVIDED WITHIN FORTY-EIGHT HOURS OF AN ACCIDENT.
  (C) Every insurer shall provide a claimant with the option of  submit-
ting  any  dispute  involving the insurer's liability to pay first party
benefits, or additional first party benefits, the amount thereof or  any
other  matter which may arise pursuant to subsection (a) of this section
to arbitration pursuant to simplified procedures to  be  promulgated  or
approved by the superintendent. Such simplified procedures shall include
an expedited eligibility hearing option, when required, to designate the
insurer  for  first  party  benefits pursuant to subsection [(d)] (E) of
this section. The expedited eligibility hearing option shall be a  forum
for  eligibility  disputes only, and shall not include the submission of
any particular bill, payment or claim for any specific benefit for adju-
dication, nor shall it consider any other defense to payment.
  [(c)] (D) An award by an arbitrator  shall  be  binding  except  where
vacated or modified by a master arbitrator in accordance with simplified
procedures  to  be  promulgated  or  approved by the superintendent. The
grounds for vacating or modifying an  arbitrator's  award  by  a  master
arbitrator shall not be limited to those grounds for review set forth in
article seventy-five of the civil practice law and rules. The award of a
master arbitrator shall be binding except for the grounds for review set
forth  in  article seventy-five of the civil practice law and rules, and
provided further that where the amount of such master arbitrator's award
is five thousand dollars or greater, exclusive of  interest  and  attor-
ney's  fees, the insurer or the claimant may institute a court action to
adjudicate the dispute de novo.
  [(d)] (E) Where there is reasonable belief more than one insurer would
be the source of first party benefits,  the  insurers  may  agree  among
themselves,  if  there  is a valid basis therefor, that one of them will
accept and pay the claim initially. If there is no such agreement,  then
the  first insurer to whom notice of claim is given shall be responsible
for payment. Any such dispute shall be resolved in accordance  with  the
arbitration procedures established pursuant to section five thousand one
hundred five of this article and regulation as promulgated by the super-
intendent,  and  any  insurer paying first-party benefits shall be reim-
bursed by other insurers for their proportionate share of the  costs  of
the claim and the allocated expenses of processing the claim, in accord-
ance  with  the  provisions entitled "other coverage" contained in regu-
lation and the provisions entitled "other sources of  first-party  bene-
fits" contained in regulation. If there is no such insurer and the motor
vehicle accident occurs in this state, then an applicant who is a quali-
fied person as defined in article fifty-two of this chapter shall insti-
tute  the  claim  against  motor vehicle accident indemnification corpo-
ration.
  S 2. This act shall take effect immediately and  shall  be  applicable
to:    (i)  all  claims made, and actions and proceedings brought, under
article fifty-one of this chapter and commenced on or after  the  effec-

A. 6421                             3

tive  date  of  this  act;  and  (ii)  all  claims made, and actions and
proceedings  brought,  under  article  fifty-one  of  this  chapter  and
commenced  prior  to  the  effective date of this act and pending on the
effective date of this act.