S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  5109--A
 
                        2017-2018 Regular Sessions
 
                             I N  S E N A T E
 
                               March 8, 2017
                                ___________
 
 Introduced by Sens. LANZA, CARLUCCI, RITCHIE, STAVISKY -- read twice and
   ordered  printed, and when printed to be committed to the Committee on
   Insurance -- recommitted to the Committee on Insurance  in  accordance
   with  Senate  Rule  6,  sec.  8 -- committee discharged, bill amended,
   ordered reprinted as amended and recommitted to said committee

 AN ACT  to  amend  the  insurance  law,  in  relation  to  enacting  the
   "construction insurance transparency act of 2018" requiring all insur-
   ers  which  issue  policies  of  liability  insurance insuring against
   claims made in reliance upon the duty imposed by the "scaffold law" to
   file annual financial statements and  detailed  claim  data  with  the
   superintendent of financial services
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  This  act  shall  be  known  and  may  be  cited  as  the
 "construction insurance transparency act of 2018".
   §  2.  Declarations  of  legislative  findings. The legislature hereby
 finds and declares that persons,  corporations,  associations  or  other
 business  entities  which issue policies of liability insurance insuring
 an owner of real property or a contractor who  is  performing  work  and
 services  on  real  property  against  claims  made in reliance upon the
 duties imposed upon such parties  by  section  240  of  the  labor  law,
 commonly  referred  to  as  the "scaffold law", owe an obligation to the
 public, to those they insure and to those  who  may  in  the  future  be
 insured  by  them,  to fully disclose in a public and transparent manner
 all elements relating to the premiums paid for such insurance, the meth-
 od and manner in which such premiums are  determined  and  imposed  upon
 insureds,  and  claims  made  by  injured persons who rely on owners and
 contractors to provide a safe and secure worksite as  required  in  such
 section  of  such  law. It is essential that the public be made aware of
 such an insurer's responsibility  to  inform  them  of  their  financial
 condition and solvency, and the details and specifics of the factors and
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD07100-03-7

 S. 5109--A                          2
 
 circumstances behind its financial solvency as well as the basis for the
 rates they charge to owners and contractors to obtain such coverage. The
 determination  of  premiums  for such liability insurance policy in this
 state has, unfortunately, gone on too long in obscurity, with even those
 who bear the cost of premiums unable to learn why prices are set as they
 are.  As a matter of public trust, liability insurers should be required
 to make the public aware of the pertinent facts related to their premium
 determinations and financial solvency by disclosing  all  the  pertinent
 facts  as  provided  for in this section. It is the further sense of the
 legislature that this data should be disclosed in  an  open  and  public
 manner, and should be made available without undue cost and delay.
   §  3. The insurance law is amended by adding a new section 343 to read
 as follows:
   § 343. FINANCIAL STATEMENT AND DETAILED CLAIM DATA TO  BE  FILED  WITH
 THE SUPERINTENDENT. (A) FOR PURPOSES OF THIS SECTION, THE TERM "INSURER"
 SHALL MEAN ANY PERSON, CORPORATION, ASSOCIATION OR OTHER BUSINESS ENTITY
 WHICH  ISSUES  A  POLICY OF LIABILITY INSURANCE INSURING A CONTRACTOR OR
 OWNER OF REAL PROPERTY LOCATED IN THIS STATE AGAINST CLAIMS MADE  BY  AN
 INJURED  WORKER,  THE  CLAIM FOR WHICH IS MADE IN RELIANCE UPON THE DUTY
 OWED TO SUCH WORKER PURSUANT TO THE PROVISIONS OF  SECTION  TWO  HUNDRED
 FORTY OF THE LABOR LAW.
   (B) ON OR BEFORE APRIL FIRST OF EACH YEAR, EVERY INSURER SHALL FOR THE
 PRIOR  CALENDAR  YEAR  PROVIDE  THE SUPERINTENDENT AND THE PUBLIC WITH A
 DETAILED FINANCIAL STATEMENT TO SUPPLEMENT AND  EXPAND  UPON  ANY  OTHER
 INFORMATION OTHERWISE PROVIDED TO THE DEPARTMENT AS IT RELATES AN INSUR-
 ER'S PROVISION OF LIABILITY INSURANCE COVERAGE TO OWNERS OF REAL PROPER-
 TY  OR  CONTRACTORS  PERFORMING  SERVICES TO OWNERS OF REAL PROPERTY FOR
 CLAIMS MADE BY AN INJURED PERSON IN  RELIANCE  UPON  THE  DUTY  OWED  BY
 SECTION  TWO HUNDRED FORTY OF THE LABOR LAW; PROVIDED, HOWEVER, THAT THE
 INITIAL FINANCIAL STATEMENT SO FILED BY AN INSURER AFTER  THE  EFFECTIVE
 DATE  OF  THIS  SECTION  SHALL  INCLUDE THE INFORMATION REQUIRED IN THIS
 SUBDIVISION NOT ONLY FOR SUCH PRIOR  CALENDAR  YEAR  BUT  ALSO  FOR  THE
 PREVIOUS NINE CALENDAR YEARS PRIOR TO SUCH REPORT.  THE FINANCIAL STATE-
 MENT SHALL, IN DEPTH, SEPARATE THE COST OF PROVIDING SECTION TWO HUNDRED
 FORTY OF THE LABOR LAW BASED COVERAGE FROM THE COST OF PROVIDING GENERAL
 LIABILITY  INSURANCE  INSURING THE SAME OWNER OR CONTRACTOR WITH RESPECT
 TO THE SAME PROPERTY AND SHALL CONTAIN AT LEAST THE  FOLLOWING  INFORMA-
 TION RELATING TO COVERAGE PURSUANT TO SUCH SECTION:  (1) THAT PORTION OF
 PREMIUMS  ASSESSED AND ATTRIBUTABLE TO PROVIDING SUCH COVERAGE; (2) PAID
 JUDGMENTS, SETTLEMENTS OR LOSSES RESULTING FROM SUCH COVERAGE; (3)  CASE
 RESERVES  FOR LOSSES WHICH MAY BE ATTRIBUTABLE TO COVERAGE; (4) INCURRED
 BUT NOT REPORTED LOSS ESTIMATES WHICH MAY BE ATTRIBUTABLE  TO  COVERAGE;
 (5)  PAID  DEFENSE  AND  COST  CONTAINMENT  EXPENSES ATTRIBUTABLE TO ANY
 CLAIMS MADE BASED UPON SUCH COVERAGE; (6) CASE RESERVES FOR DEFENSE  AND
 COST  CONTAINMENT  EXPERIENCE ATTRIBUTABLE TO ANY CLAIMS MADE BASED UPON
 SUCH COVERAGE; (7) INCURRED BUT NOT REPORTED DEFENSE AND  COST  CONTAIN-
 MENT ESTIMATES BASED UPON SUCH COVERAGE; (8) PREMIUM AND LOSS EXPERIENCE
 IDENTIFIED BY POLICY LIMITS AND DEDUCTIBLES; (9) NUMBER OF CLAIMS INITI-
 ATED  AND  CLOSED; (10) NUMBER OF CLAIMS CLOSED WITH LOSS PAYMENTS; (11)
 NUMBER OF OPEN CLAIMS AT THE TIME SUCH STATEMENT IS PREPARED; (12) OTHER
 EXPENSES BY CATEGORY AS DETERMINED BY THE SUPERINTENDENT TO REFLECT  THE
 COST  TO  THE  INSURER  TO  PROVIDE SUCH COVERAGE AS PART OF A LIABILITY
 INSURANCE POLICY; (13) INVESTMENT INCOME REALIZED FROM THAT  PORTION  OF
 THE  PREMIUM  PAID FOR A POLICY PROVIDING SUCH COVERAGE; (14) THE AMOUNT
 OF EXPOSURE TO THE INSURER RESULTING FROM THE PROVISION OF SUCH COVERAGE
 AND WHETHER THE INSURER HAS LIMITED  THE  AMOUNT  OF  COVERAGE  PROVIDED

 S. 5109--A                          3
 
 TOGETHER  WITH  AN ESTIMATE OF THE AMOUNT WHICH MIGHT BE REQUIRED OF THE
 INSURED TO PURCHASE FURTHER COVERAGE FROM AN OUT OF STATE  EXCESS  LINES
 PROVIDER,  BASED  UPON CURRENT DATA AVAILABLE TO SUCH IN-STATE PROVIDER,
 ESPECIALLY  WHERE  SUCH  IN-STATE  PROVIDER  OPERATES  AS AN EXCESS LINE
 INSURER FOR RISKS IN ANOTHER STATE; (15) AMOUNTS SPENT  BY  INSURER  FOR
 RISK  MANAGEMENT  PROGRAMS,  OR  REQUIRED TO BE SPENT BY INSUREDS AT THE
 BEHEST OF THE INSURER, WHICH  PROGRAMS  ARE  DESIGNED  AND  INTENDED  TO
 PROMOTE  WORKSITE  SAFETY,  MORE  PARTICULARLY  AS  IT RELATES TO HEIGHT
 RELATED ACCIDENTS COVERED BY SECTION TWO HUNDRED FORTY OF THE LABOR LAW;
 AND (16) THE AFOREGOING EXPERIENCE AND INFORMATION FURTHER SUBDIVIDED BY
 QUALITY OF RISK AS MEASURED BY PRIOR LOSS EXPERIENCE, CONTRACTOR PAYROLL
 RANGES, CONTRACTOR NUMBER OF EMPLOYEE RANGES,  RISK  MANAGEMENT  PARTIC-
 IPATION,  AND  OTHER  RELEVANT  IDENTIFIABLE  DIFFERENCES IN EXPOSURE TO
 INSURANCE LOSS. THE DATA PROVIDED BY INSURERS SHALL BE SEPARATED OUT  SO
 THAT  A  DETERMINATION  CAN  BE  MADE THAT A CLAIM MADE OR PAID IS BASED
 PARTIALLY OR TOTALLY UPON SECTION TWO HUNDRED FORTY OF  THE  LABOR  LAW;
 COVERAGE,  AND NOT ANY OTHER PROVISION OF STATUTORY OR COMMON LAW IMPOS-
 ING ANOTHER OR DIFFERENT OR SEPARATE STANDARD OF  CARE  OR  DUTY  TO  AN
 INJURED  PARTY.   SUCH FINANCIAL STATEMENT SHALL INCLUDE THE ENTIRETY OF
 SUCH INSURER'S BUSINESS ACTIVITIES INSURING AGAINST RISKS  OCCURRING  IN
 THIS  STATE AND SHALL BE IN A FORM DETERMINED BY THE SUPERINTENDENT. THE
 FORM SHALL BE SUFFICIENTLY ITEMIZED IN A MANNER THAT ALLOWS FOR AN ACTU-
 ARIALLY SOUND ANALYSIS OF THE INCOME REALIZED BY THE  INSURER  FROM  ALL
 SOURCES DURING SUCH YEAR, INCLUDING BUT NOT LIMITED TO PREMIUMS, INVEST-
 MENT  INCOME,  AND  ANY OTHER CATEGORY OR CATEGORIES OF INCOME AS DETER-
 MINED BY THE SUPERINTENDENT TO REFLECT THE FULL DISCLOSURE  REQUIREMENTS
 OF  THIS  SECTION  AND THAT PORTION WHICH MAY BE SPECIFICALLY RELATED TO
 SUCH COVERAGE. AT A MINIMUM, SUCH INFORMATION SHALL CONSIST OF THE ITEMS
 SET FORTH IN THE STATEMENT OF INCOME, EXCLUDING THE CAPITAL AND  SURPLUS
 ACCOUNT  SECTION OF THE PROPERTY/CASUALTY STATUTORY ANNUAL STATEMENT, AS
 APPLICABLE TO THE INSURER'S NEW YORK STATE  BUSINESS,  AS  WELL  AS  THE
 OTHER  INFORMATION  DELINEATED IN THIS SUBSECTION. SUCH FINANCIAL STATE-
 MENT SHALL ALSO CONTAIN A COMPREHENSIVE AND DETAILED DISCLOSURE  OF  THE
 INSURER'S EXPENSES ACTUALLY INCURRED AND PAID DURING SUCH CALENDAR YEAR,
 TO  INCLUDE  NORMAL BUSINESS EXPENSES, SALARIES, COMMISSIONS, CONSULTING
 FEES, LEGAL EXPENSES, ADVERTISING COSTS AND ANY  OTHER  CATEGORY  DEEMED
 PERTINENT  TO  THE  INTENT  OF  THIS  SECTION. AT A MINIMUM, THE EXPENSE
 INFORMATION REQUIRED SHALL CONSIST OF THE ITEMS SET FORTH IN THE  UNDER-
 WRITING   AND   INVESTMENT   EXHIBIT   -   PART  3  -  EXPENSES  OF  THE
 PROPERTY/CASUALTY STATUTORY  ANNUAL  STATEMENT,  AS  APPLICABLE  TO  THE
 INSURER'S  NEW  YORK STATE BUSINESS. WITH RESPECT TO SALARIES (INCLUDING
 ALL OTHER FORMS OF COMPENSATION), EACH INSURER SHALL ITEMIZE THE  SALARY
 OF  THE  TWENTY MOST HIGHLY COMPENSATED EMPLOYEES OF SUCH INSURER DURING
 SUCH YEAR, PROVIDED THAT  THE  NAMES  OF  SUCH  EMPLOYEES  NEED  NOT  BE
 DISCLOSED.   SUCH FINANCIAL STATEMENT SHALL ALSO PROVIDE THE PUBLIC WITH
 A SYNOPSIS OF CLAIMS OR SETTLEMENTS PAID FOR SECTION TWO  HUNDRED  FORTY
 OF  THE LABOR LAW COVERAGE PURSUANT TO SUCH POLICIES OR CONTRACTS, LIST-
 ING THE TOTAL OF SUCH CLAIMS AND SETTLEMENTS ATTRIBUTABLE TO SUCH COVER-
 AGE. AT A MINIMUM, THE CLAIM INFORMATION REQUIRED SHALL CONSIST  OF  THE
 ITEMS   SET  FORTH  IN  THE  EXHIBIT  OF  PREMIUMS  AND  LOSSES  OF  THE
 PROPERTY/CASUALTY STATUTORY  ANNUAL  STATEMENT,  AS  APPLICABLE  TO  THE
 INSURER'S  NEW  YORK STATE BUSINESS AND IDENTIFIED AND CATEGORIZED SEPA-
 RATELY FOR EACH ZIP CODE IN THIS STATE. SUCH FINANCIAL  STATEMENT  SHALL
 BE SIGNED AND ATTESTED AS FULL, COMPLETE AND ACCURATE BY THE CHIEF EXEC-
 UTIVE  OFFICER  OF  THE  INSURER, AND HE OR SHE SHALL BE HELD PERSONALLY
 RESPONSIBLE WITH RESPECT TO THE ACCURACY OF THE CONTENT OF  SUCH  STATE-

 S. 5109--A                          4
 
 MENT.  THE SUPERINTENDENT SHALL PROVIDE INSURERS WITH A METHOD TO SUBMIT
 THEIR FINANCIAL STATEMENTS ELECTRONICALLY VIA THE INTERNET, WHICH METHOD
 SHALL INCLUDE INSTRUCTIONS RELATING TO THE USE OF AN  ELECTRONIC  SIGNA-
 TURE WHICH SHALL BE SUBJECT TO, AND SUBMITTED IN ACCORDANCE WITH SECTION
 THREE HUNDRED SIXTEEN OF THIS ARTICLE; PROVIDED, HOWEVER, THAT NO EXCEP-
 TION AUTHORIZED IN SUCH SECTION MAY BE REQUESTED OR GRANTED.
   (C) ON OR BEFORE APRIL FIRST OF EACH YEAR, EVERY INSURER SHALL PROVIDE
 THE  SUPERINTENDENT  WITH DETAILED CLOSED CLAIM INFORMATION FOR THE SAME
 INSURANCE COVERAGE AS PROVIDED FOR IN SUBSECTION (B) OF THIS SECTION FOR
 THE MOST RECENTLY CONCLUDED  CALENDAR  YEAR.  UNTIL  THE  SUPERINTENDENT
 PROMULGATES  DATA  COLLECTION  FORMS  AND PROCEDURES FOR THE ITEMIZATION
 REQUIREMENTS, DATA SHALL BE COLLECTED USING,  AT  A  MINIMUM,  THE  MOST
 RECENT PUBLICLY AVAILABLE FORMS REQUIRED BY LAW, OR COMMONLY USED IN THE
 INSURANCE  INDUSTRY.  THE SUPERINTENDENT MAY REQUIRE ADDITIONAL INFORMA-
 TION BEYOND THAT WHICH MAY OTHERWISE BE CURRENTLY REQUIRED IF HE OR  SHE
 DEEMS  IT  NECESSARY  AND WARRANTED WITHOUT THE NEED TO FORMALLY ADOPT A
 RULE OR REGULATION PROVIDED SUCH  REQUIREMENT  IS  CONSISTENT  WITH  THE
 INTENT  OF  THIS  SECTION.  SUCH DETAILED CLAIM DATA SHALL BE SIGNED AND
 ATTESTED AS FULL, COMPLETE AND ACCURATE BY THE CHIEF  EXECUTIVE  OFFICER
 OF  THE INSURER, AND HE OR SHE SHALL BE HELD PERSONALLY RESPONSIBLE WITH
 RESPECT TO THE ACCURACY OF THE DATA. THE DETAILED CLAIM  DATA  SHALL  BE
 SUBMITTED  IN  THE SAME MANNER AS PROVIDED FOR IN SUBSECTION (B) OF THIS
 SECTION.
   (D) THE SUPERINTENDENT SHALL, IN BOTH WRITTEN FORM AND AS PART OF  THE
 DEPARTMENT  WEB  SITE, MAKE SUCH FINANCIAL STATEMENTS AND DETAILED CLAIM
 INFORMATION AVAILABLE TO THE  PUBLIC.  THE  DETAILED  CLAIM  INFORMATION
 SHALL  BE  PROVIDED  IN AGGREGATE FORM FOR ALL INSURERS AND SEPARATED BY
 SPECIFIC INSURER, COMBINED WITHOUT  ANY  IDENTIFICATION  OF  A  SPECIFIC
 CLAIM  TO  A SPECIFIC INSURER.   NONE OF THE PUBLICLY AVAILABLE DETAILED
 CLAIM INFORMATION SHALL IDENTIFY THE INDIVIDUAL  INSURER,  DEFENDANT  OR
 PLAINTIFF,  OR  REPRESENTATIVE  OF  THE SAME, ASSOCIATED WITH THE CLAIM.
 SUCH FINANCIAL STATEMENTS AND DETAILED CLAIM INFORMATION SHALL BE DEEMED
 A PUBLIC DOCUMENT AND NO PERSON SHALL BE REQUIRED TO FILE A REQUEST  FOR
 SUCH FINANCIAL STATEMENTS PURSUANT TO ARTICLE SIX OF THE PUBLIC OFFICERS
 LAW  IN ORDER TO RECEIVE A COPY THEREOF, BUT UPON REQUEST AND PAYMENT OF
 THE FEE FOR COPYING SUCH DOCUMENT, IT SHALL BE PROVIDED FORTHWITH.  WITH
 RESPECT TO THE ELECTRONIC COPY OF SUCH FINANCIAL STATEMENTS AND DETAILED
 CLAIM  INFORMATION,  WHICH  SHALL  BE ACCESSIBLE ON THE DEPARTMENT'S WEB
 SITE, THE DEPARTMENT SHALL HIGHLIGHT THE AVAILABILITY OF  SUCH  INFORMA-
 TION  TO  THE  PUBLIC  ON  SUCH WEB SITE, AND THE LINK TO EACH INSURER'S
 FINANCIAL STATEMENT AND THE AGGREGATED DETAILED CLAIM INFORMATION  SHALL
 BE  ACCESSIBLE IN A SIMPLE AND EASY MANNER. BOTH THE FINANCIAL STATEMENT
 AND AGGREGATED DETAILED CLAIM INFORMATION ON THE DEPARTMENT'S  WEB  SITE
 SHALL  BE  AVAILABLE  IN  SPREADSHEET  FORMAT,  IN ADDITION TO ANY OTHER
 FORMAT THE SUPERINTENDENT DETERMINES IS APPROPRIATE. WHERE SUMMARIES ARE
 INCLUDED, THEY SHALL BE WRITTEN IN PLAIN AND SIMPLE ENGLISH SO THAT  THE
 PUBLIC AT LARGE CAN EASILY COMPREHEND THE DATA PROVIDED.
   (E)  ON  OR  BEFORE  JULY FIRST OF EACH YEAR, THE SUPERINTENDENT SHALL
 ISSUE REPORTS SUMMARIZING AND EXPLAINING THE INFORMATION COLLECTED  FROM
 THE  FINANCIAL  STATEMENTS AND THE DETAILED CLAIM INFORMATION AND SUMMA-
 RIZING THE COST AND  OTHER  ESSENTIAL  ELEMENTS  RELEVANT  TO  PROVIDING
 SECTION  TWO  HUNDRED FORTY OF THE LABOR LAW COVERAGE. SUCH REPORT SHALL
 FURTHER CONTAIN SUCH RECOMMENDATIONS THE SUPERINTENDENT DEEMS  ADVISABLE
 TO ENCOURAGE THE UTILIZATION OF RISK MANAGEMENT PROGRAMS TO BE REGULARLY
 CONDUCTED  BY  CONTRACTORS TO REDUCE PREMIUMS AND PROVIDE WORKERS WITH A
 SAFER WORK ENVIRONMENT, AND ANY OTHER STEPS CONTRACTORS OR REAL PROPERTY

 S. 5109--A                          5

 OWNERS SHOULD UTILIZE IN FURTHERANCE OF THE SAME. THE SUPERINTENDENT MAY
 SEEK, AND SHALL BE ENTITLED TO RECEIVE, THE AID AND  ASSISTANCE  OF  THE
 COMMISSIONER OF LABOR AND ANY OTHER STATE OR LOCAL GOVERNMENTAL OFFICIAL
 CHARGED WITH RESPONSIBILITY FOR WORK SITE SAFETY IN PREPARING SUCH ANAL-
 YSIS  AND RECOMMENDATIONS.  COPIES OF SUCH REPORTS SHALL BE FORWARDED TO
 THE TEMPORARY PRESIDENT OF THE SENATE, THE SPEAKER OF THE  ASSEMBLY  AND
 THE CHAIRS OF THE SENATE AND ASSEMBLY INSURANCE COMMITTEES. SUCH REPORTS
 SHALL BE PUBLIC DOCUMENTS AND SHALL BE ACCESSIBLE BOTH IN PAPER COPY AND
 ON  THE  DEPARTMENT'S  WEB  SITE IN A SIMILAR FASHION AS PROVIDED FOR IN
 SUBSECTION (D) OF THIS SECTION.
   (F) WHERE AN INSURER FAILS OR REFUSES TO  PROVIDE  THE  SUPERINTENDENT
 WITH  A  FULL  AND  COMPLETE DISCLOSURE AS REQUIRED BY THIS SECTION, THE
 SUPERINTENDENT SHALL TAKE SUCH ACTION HE OR SHE DEEMS NECESSARY TO BRING
 THE INSURER INTO FULL COMPLIANCE. SUCH ACTION MAY INCLUDE IMPOSITION  OF
 A  CIVIL  PENALTY  OF  UP TO FIFTY THOUSAND DOLLARS ASSESSED AGAINST THE
 INSURER FOR EACH VIOLATION, TEMPORARY SUSPENSION OF ANY RIGHT  TO  ISSUE
 ADDITIONAL  POLICIES  OR  CONTRACTS UNTIL THE INSURER BRINGS ITSELF INTO
 FULL COMPLIANCE, AN AUDIT OF THE INSURER'S RECORDS BY THE DEPARTMENT  OR
 ITS  DESIGNATED REPRESENTATIVE TO OBTAIN THE INFORMATION AND WHICH AUDIT
 SHALL BE PAID FOR BY THE INSURER, OR ANY OTHER CIVIL REMEDY  THE  SUPER-
 INTENDENT   DEEMS  WARRANTED  OR  NECESSARY  UNTIL  SUCH  INSURER  FULLY
 COMPLIES. IN ADDITION THE OFFICER WHOSE SIGNATURE  IS  AFFIXED  TO  SUCH
 STATEMENT MAY BE PERSONALLY PENALIZED TO THE SAME EXTENT.
   (G) THE SUPERINTENDENT MAY PROMULGATE SUCH RULES AND REGULATIONS HE OR
 SHE  DEEMS  NECESSARY FOR THE PROPER ADMINISTRATION OF THE PROVISIONS OF
 THIS SECTION, AND SUCH RULES AND REGULATIONS MAY BE  PROMULGATED  ON  AN
 EMERGENCY  BASIS IF THE SUPERINTENDENT WARRANTS SUCH ACTION TO BE NECES-
 SARY.
   § 4. Severability. If any item, clause, sentence, subparagraph, subdi-
 vision or other part of this act, or  the  application  thereof  to  any
 person  or circumstances shall be held to be invalid, such holding shall
 not affect, impair or invalidate the remainder of this act but it  shall
 be  confined  in  its  operation to the item, clause, sentence, subpara-
 graph, subdivision or other part of this act directly involved  in  such
 holding, or to the person and circumstances therein involved.
   §  5. This act shall take effect on the first of January next succeed-
 ing the date upon which it shall have become a law.