NY State Senate Bill 2019-S8211

Senate Bill S8211

2019-2020 Legislative Session

Relates to requiring certain perils be covered under business interruption insurance during the coronavirus disease 2019 (COVID-19) pandemic

download bill text pdf

Archive: Last Bill Status - In Senate Committee Insurance Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
May 01, 2020	print number 8211a
May 01, 2020	amend and recommit to insurance
Apr 17, 2020	referred to insurance

Bill Amendments

Original

A (Active)

co-Sponsors

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2019-S8211 - Details

Current Committee:: Senate Insurance
Law Section:: Insurance
Versions Introduced in 2021-2022 Legislative Session:: S4711

2019-S8211 - Summary

Requires certain perils be covered under business interruption insurance during the coronavirus disease 2019 (COVID-19) pandemic.

2019-S8211 - Sponsor Memo

                                
 
BILL NUMBER: S8211

SPONSOR: GOUNARDES
 
TITLE OF BILL:

An act in relation to requiring certain perils be covered under business
interruption insurance during the coronavirus disease 2019 (COVID-19)
pandemic

 
PURPOSE OR GENERAL IDEA OF BILL:

This bill is intended to hold harmless businesses who currently hold
business interruption insurance, for losses sustained as a result of the
current COVID-19 health emergency, but for which no such coverage is
currently offered.

 
SUMMARY OF PROVISIONS:

Section 1 provides a mechanism by which certain businesses that suffer
losses due to interruption as a result of the COVID-2019 pandemic may
recover those losses from their insurer if they had a policy of business

interruption insurance in force on March 7, 2020, the date on which the
Governor declared a Public Health Emergency and State of Emergency in
Executive Order 202.

The bill would apply to businesses covered by such a policy with less
than 250 eligible employees in the State of New York. "Eligible employ-
ee" is defined as a full-time employee who works a normal work week of
25 or more hours. This section stipulates that every policy of insurance
related to business interruption insurance that expires during the covid
19 state of emergency shall be subject to automatic renewal at the
current rate. Additionally this section requires that any existing
insurance policy that allows the insurer to deny coverage based on a
virus that causes illness be declared null and void.

Section 2 provides that an insurer which indemnifies an insured who has
filed a claim pursuant to its provisions may apply to the Superintendent
of the Department of Financial Services for relief and reimbursement
from funds collected and made available for this purpose as provided in
the bill, pursuant to an additional special purpose assessment under the
general scheme already established by law to recover the general
expenses of the Department of Financial Services as the regulator of the
insurance industry in this State. The superintendent shall establish
procedures for the submission and qualification of claims by insurers
which are eligible for reimbursement, incorporating such standards as
are necessary to protect against the submission of fraudulent claims by
insureds, and appropriate safeguards for insurers to employ in the
review and payment of such claims.

Section 3 authorizes the superintendent to impose upon, distribute
among, and collect from insurance companies, other than life and health
insurance companies, the additional amounts as may be necessary to
recover the amounts paid pursuant to the bill. The additional special
purpose apportionment authorized by the bill shall be distributed
according to essentially the same procedures and calculations as are
provided currently for the existing special purpose apportionment.

Section 4 sets the effective date.

 
JUSTIFICATION:

Industry sources have indicated that global virus transmission and
pandemic are generally excluded from the list of covered perils under
the existing standard business interruption insurance policy. The Insur-
ance Services Office, ISO, has developed a rider to provide an insured
with the option of purchasing such coverage, but to date, no states have
yet approved the form. This bill is intended to hold harmless businesses
who currently hold business interruption insurance, for losses sustained
as a result of the current COVID-19 health emergency, but for which no
such coverage is currently offered.

 
PRIOR LEGISLATIVE HISTORY:

New bill.

 
FISCAL IMPLICATIONS:

None.

 
EFFECTIVE DATE:
This act will be retroactive to March 7, 2020

2019-S8211 - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   8211
 
                             I N  S E N A T E
 
                              April 17, 2020
                                ___________
 
 Introduced  by Sens. GOUNARDES, MAYER -- read twice and ordered printed,
   and when printed to be committed to the Committee on Insurance
 
 AN ACT in relation to requiring certain perils be covered under business
   interruption insurance during the coronavirus disease 2019  (COVID-19)
   pandemic
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. (a) Notwithstanding any provisions of law,  rule  or  regu-
 lation  to the contrary, every policy of insurance insuring against loss
 or damage to property, which includes, but is not limited to,  the  loss
 of  use  and  occupancy and business interruption, shall be construed to
 include among the covered perils under that policy, coverage  for  busi-
 ness  interruption  during a period of a declared state emergency due to
 the coronavirus disease 2019 (COVID-19) pandemic.
   (b) Every policy of insurance insuring against loss or damage to prop-
 erty, which includes, but is not limited to, the loss of use  and  occu-
 pancy and business interruption, whose policy expires during a period of
 a  declared  state emergency due to the coronavirus disease 2019 (COVID-
 19) pandemic, shall be subject to an automatic renewal of the policy  at
 the current rate of charge.
   (c)  Any clause or provision of a policy of insurance insuring against
 loss or damage to property, which includes, but is not limited  to,  the
 loss  of  use  and occupancy and business interruption, which allows the
 insurer to deny coverage based on a virus, bacterium, or other  microor-
 ganism  that  causes  disease,  illness, or physical distress or that is
 capable of causing disease illness, or physical distress shall  be  null
 and void; provided, however, the remaining clauses and provisions of the
 contract shall remain in effect for the duration of the contract term.
   (d) The coverage required by this section shall indemnify the insured,
 subject  to  the  limits  under  the policy, for any loss of business or
 business interruption for the duration of a period of a  declared  state
 emergency due to the coronavirus disease 2019 (COVID-19) pandemic.
   (e)  This section shall apply to policies issued to insureds with less
 than 250 eligible employees in force on the effective date of this  act.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets

                       [ ] is old law to be omitted.
                                                            LBD16053-04-0

 S. 8211                             2
 
 "Eligible  employee"  means a full-time employee who works a normal work
 week of 25 or more hours.
   § 2. (a) An insurer which indemnifies an insured who has filed a claim
 pursuant  to  section one of this act may apply to the superintendent of
 financial services for relief and reimbursement by the  department  from
 funds  collected  and  made  available  for  this purpose as provided in
 section three of this act.
   (b) The superintendent of financial services  shall  establish  proce-
 dures  for  the submission and qualification of claims by insurers which
 are eligible for reimbursement pursuant to this act. The  superintendent
 of  financial services shall incorporate in these procedures such stand-
 ards as are necessary to protect against the  submission  of  fraudulent
 claims by insureds, and appropriate safeguards for insurers to employ in
 the review and payment of such claims.
   §  3.  (a)  The  superintendent of financial services is authorized to
 impose upon, distribute among, and collect from the companies engaged in
 business pursuant to the insurance law, such additional amounts  as  may
 be necessary to recover the amounts paid to insurers pursuant to section
 two of this act.
   (b)  The  additional special purpose apportionment authorized pursuant
 to subdivision (a) of this section shall be distributed in  the  propor-
 tion  that  the net written premiums received by each company subject to
 the apportionment authorized by this section for  insurance  written  or
 renewed  on  risks  in  this  state during the calendar year immediately
 preceding, bears to the sum total  of  all  such  net  written  premiums
 received  by all companies writing that insurance or coverage within the
 state during that calendar year, as reported.
   (c) For the purposes of this section, "net written premiums  received"
 means  gross  direct  premiums written, less return premiums thereon and
 dividends credited or paid to policyholders, as reported on  the  compa-
 ny's annual financial statement.
   §  4.  This  act shall take effect immediately, and shall be deemed to
 have been in full force and effect on and after March 7, 2020 and  shall
 apply to insurance policies in force on that date.

co-Sponsors

View additional co-sponsors

2019-S8211A (ACTIVE) - Details

Current Committee:: Senate Insurance
Law Section:: Insurance
Versions Introduced in 2021-2022 Legislative Session:: S4711

2019-S8211A (ACTIVE) - Summary

Requires certain perils be covered under business interruption insurance during the coronavirus disease 2019 (COVID-19) pandemic.

2019-S8211A (ACTIVE) - Sponsor Memo

                                
 
BILL NUMBER: S8211A

SPONSOR: GOUNARDES
 
TITLE OF BILL:

An act in relation to requiring certain perils be covered under business
interruption insurance during the coronavirus disease 2019 (COVID-19)
pandemic

 
PURPOSE OR GENERAL IDEA OF BILL:

This bill is intended to hold harmless businesses and non-profits who
currently hold business interruption insurance, for losses sustained as
a result of the current COVID-19 health emergency, but for which no such
coverage is currently offered.

 
SUMMARY OF PROVISIONS:

Section 1 Defines terms

Section 2 provides a mechanism by which certain businesses that suffer

losses due to interruption as a result of the COVID-2019 pandemic may
recover those losses from their insurer if they had a policy of business
interruption insurance in force on March 7, 2020, the date on which the
Governor declared a Public Health Emergency and State of Emergency in
Executive Order 202. The bill would apply to businesses covered by such
a policy with less than 250 eligible employees in the State of New York.
"Eligible employee" is defined as a full-time employee who works a
normal work week of 25 or more hours. This section stipulates that every
policy of insurance related to business interruption insurance that
expires during the covid 19 state of emergency shall be subject to auto-
matic renewal at the current rate.  Additionally this section requires
that any existing insurance policy that allows the insurer to deny
coverage based on a virus that causes illness be declared null and void.

Section 3 provides that an insurer which indemnifies an insured who has
filed a claim pursuant to its provisions may apply to the Superintendent
of the Department of Financial Services for relief and reimbursement
from funds collected and made available for this purpose as provided in
the bill, pursuant to an additional special purpose assessment under the
general scheme already established by law to recover the general
expenses of the Department of Financial Services as the regulator of the
insurance industry in this State.  The superintendent shall establish
procedures for the submission and qualification of claims by insurers
which are eligible for reimbursement, incorporating such standards as
are necessary to protect against the submission of fraudulent claims by
insureds, and appropriate safeguards for insurers to employ in the
review and payment of such claims.

Section 4 authorizes the superintendent to impose upon, distribute
among, and collect from insurance companies, other than life and health
insurance companies, the additional amounts as may be necessary to
recover the amounts paid pursuant to the bill. The additional special
purpose apportionment authorized by the bill shall be distributed
according to essentially the same procedures and calculations as are
provided currently for the existing special purpose apportionment.

Section 5 sets the effective date.

 
JUSTIFICATION:

Industry sources have indicated that global virus transmission and
pandemic are generally excluded from the list of covered perils under
the existing standard business interruption insurance policy. The Insur-
ance Services Office, ISO, has developed a rider to provide an insured
with the option of purchasing such coverage, but to date, no states have
yet approved the form. This bill is intended to hold harmless businesses
who currently hold business interruption insurance, for losses sustained
as a result of the current COVID-19 health emergency, but for which no
such coverage is currently offered.

 
PRIOR LEGISLATIVE HISTORY:

None

 
FISCAL IMPLICATIONS:

TBD

 
EFFECTIVE DATE:
This act shall take effect immediately, shall be retroactive to March 7,
2020

2019-S8211A (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  8211--A
 
                             I N  S E N A T E
 
                              April 17, 2020
                                ___________
 
 Introduced  by  Sens.  GOUNARDES,  MAYER, KAPLAN, KENNEDY, MAY, PERSAUD,
   SEPULVEDA -- read twice and ordered printed, and when  printed  to  be
   committed  to the Committee on Insurance -- committee discharged, bill
   amended, ordered reprinted as amended and recommitted to said  commit-
   tee
 
 AN ACT in relation to requiring certain perils be covered under business
   interruption  insurance during the coronavirus disease 2019 (COVID-19)
   pandemic
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1.  For the purposes of this act:
   (a) "business" shall mean a business registered with the department of
 tax and finance or not-for-profit corporation registered with the Attor-
 ney General's charities bureau.
   (b)  "income"  shall  mean traditional business income as well as not-
 for-profit revenue from donations, sponsorships, and grants.
   (c) "net written premiums received" shall mean gross  direct  premiums
 written,  less return premiums thereon and dividends credited or paid to
 policyholders, as reported on the company's annual financial statement.
   (d) "premium taxes" shall mean payments required under subdivision (d)
 of section 2118 of the insurance law.
   § 2. (a) Notwithstanding any provisions of law, rule or regulation  to
 the  contrary, every policy of insurance insuring against loss or damage
 to property, which includes, but is not limited to, the loss of use  and
 occupancy and business interruption, shall be construed to include among
 the covered perils under that policy, coverage for business interruption
 during  a  period  of  a declared state emergency due to the coronavirus
 disease 2019 (COVID-19) pandemic.
   (b) Every policy of insurance insuring against loss or damage to prop-
 erty, which includes, but is not limited to, the loss of use  and  occu-
 pancy and business interruption, whose policy expires during a period of
 a  declared  state emergency due to the coronavirus disease 2019 (COVID-
 19) pandemic, shall be subject to an automatic renewal of the policy  at
 the current rate of charge.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets

                       [ ] is old law to be omitted.
                                                            LBD16053-06-0

 S. 8211--A                          2
 
   (c)  Every policy of insurance or endorsement thereto insuring against
 an insured's business  income  loss  resulting  from  loss,  damage,  or
 destruction  of  property owned by others, including direct suppliers of
 goods or services to the insured and/or direct  receivers  of  goods  or
 services  manufactured or provided by the insured, shall be construed to
 include among the covered perils under that policy, coverage for contin-
 gent business interruption during a period of a declared state emergency
 due the coronavirus disease 2019 (COVID-19) pandemic.
   (d) Every policy of insurance or endorsement thereto insuring  against
 an  insured's  business  income  loss  resulting  from  loss, damage, or
 destruction of property owned by others, including direct  suppliers  of
 goods  or  services  to  the insured and/or direct receivers of goods or
 services manufactured or provided by the insured, whose  policy  expires
 during  a  period  of  a declared state emergency due to the coronavirus
 disease 2019 (COVID-19) pandemic,  shall  be  subject  to  an  automatic
 renewal of the policy at the current rate of charge.
   (e)  Any clause or provision of a policy of insurance insuring against
 loss or damage to property, which includes, but is not limited  to,  the
 loss of use and occupancy and business interruption and contingent busi-
 ness  interruption, which allows the insurer to deny coverage based on a
 virus, bacterium, or other microorganism that causes  disease,  illness,
 or  physical distress or that is capable of causing disease, illness, or
 physical distress shall be null and void; provided, however, the remain-
 ing clauses and provisions of the contract shall remain  in  effect  for
 the duration of the contract term.
   (f) The coverage required by this section shall indemnify the insured,
 subject  to  the  limits  under  the policy, for any loss of business or
 business interruption and contingent business interruption for the dura-
 tion of a period of a declared state emergency due  to  the  coronavirus
 disease 2019 (COVID-19) pandemic.
   (g)  This section shall apply to policies issued to insureds with less
 than 250 eligible employees in force on the effective date of this  act.
 "Eligible  employee"  means a full-time employee who works a normal work
 week of 25 or more hours.
   § 3. (a) An insurer, including excess  lines  insurers,  which  indem-
 nifies  an insured who has filed a claim pursuant to section two of this
 act may apply to the superintendent of financial services for relief and
 reimbursement by the department from funds collected and made  available
 for this purpose as provided in section four of this act.
   (b)  The  superintendent  of financial services shall establish proce-
 dures for the submission and qualification of claims by  insurers  which
 are  eligible for reimbursement pursuant to this act. The superintendent
 of financial services shall incorporate in these procedures such  stand-
 ards  as  are  necessary to protect against the submission of fraudulent
 claims by insureds, and appropriate safeguards for insurers to employ in
 the review and payment of such claims.
   § 4. (a) The superintendent of financial  services  is  authorized  to
 impose upon, distribute among, and collect from the companies, including
 excess  lines  insurers,  engaged  in business pursuant to the insurance
 law, such additional amounts as may be necessary to recover the  amounts
 paid to insurers pursuant to section three of this act.
   (b)  The  additional special purpose apportionment authorized pursuant
 to subdivision (a) of this section shall be distributed in  the  propor-
 tion  that  the  net  written  premiums, or premium taxes in the case of
 excess lines insurers, received by each company subject  to  the  appor-
 tionment  authorized by this section for insurance written or renewed on

 S. 8211--A                          3

 risks in this state during  the  calendar  year  immediately  preceding,
 bears  to  the  sum  total  of all such net written premiums, or premium
 taxes in the case of excess lines insurers, received  by  all  companies
 writing that insurance or coverage within the state during that calendar
 year, as reported.
   §  5.  This  act shall take effect immediately, and shall be deemed to
 have been in full force and effect on and after March 7, 2020 and  shall
 apply to insurance policies in force on that date.

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Senate Bill S8211

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Sponsored By

Archive: Last Bill Status - In Senate Committee Insurance Committee

Bill Amendments

co-Sponsors

2019-S8211 - Details

2019-S8211 - Summary

2019-S8211 - Sponsor Memo

2019-S8211 - Bill Text download pdf

co-Sponsors

2019-S8211A (ACTIVE) - Details

2019-S8211A (ACTIVE) - Summary

2019-S8211A (ACTIVE) - Sponsor Memo

2019-S8211A (ACTIVE) - Bill Text download pdf

Comments