S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                    504
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                                (PREFILED)
 
                              January 6, 2021
                                ___________
 
 Introduced  by  Sen. BRESLIN -- read twice and ordered printed, and when
   printed to be committed to the Committee on Insurance
 
 AN ACT to amend  the  insurance  law,  in  relation  to  providing  loss
   prevention programs

   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Section 2324  of  the  insurance  law,  subsection  (a)  as
 amended  by  chapter  291  of  the  laws  of 2012, is amended to read as
 follows:
   § 2324. Rebating and discrimination. (a)  No  authorized  insurer,  no
 licensed  insurance agent, no licensed insurance broker, and no employee
 or other representative of any such insurer, agent or broker shall make,
 procure or negotiate any contract of insurance  other  than  as  plainly
 expressed in the policy or other written contract issued or to be issued
 as evidence thereof, or shall directly or indirectly, by giving or shar-
 ing  a  commission or in any manner whatsoever, pay or allow or offer to
 pay or allow to the insured or to any employee of the insured, either as
 an inducement to the making of insurance or  after  insurance  has  been
 effected,  any rebate from the premium which is specified in the policy,
 or any special favor or advantage in the dividends or other  benefit  to
 accrue  thereon,  or  shall give or offer to give any valuable consider-
 ation or inducement of any kind, directly or indirectly,  which  is  not
 specified  in such policy or contract, other than any valuable consider-
 ation,  including  but  not  limited  to   merchandise   or   periodical
 subscriptions,  not  exceeding  twenty-five  dollars  in value, or shall
 give, sell or purchase, or offer  to  give,  sell  or  purchase,  as  an
 inducement  to  the making of such insurance or in connection therewith,
 any stock, bond or other securities or any dividends or profits  accrued
 thereon,  nor  shall  the insured, his agent or representative knowingly
 receive directly or indirectly, any such  rebate  or  special  favor  or
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
              

                       [ ] is old law to be omitted.
                                                            LBD00164-01-1

 S. 504                              2
 
 advantage,  provided,  however, a licensed insurance agent or a licensed
 insurance broker may retain the usual commission or underwriting fee  on
 insurance  placed on his own property or risks, if the aggregate of such
 commissions  or  underwriting  fees  will not exceed five percent of the
 total net commissions or underwriting fees  received  by  such  licensed
 insurance agent or insurance broker during the calendar year.
   (b)  Within  the  meaning  of  subsection (a) hereof, the sharing of a
 commission with the insured shall be deemed to include any case in which
 a licensed insurance agent or a licensed insurance  broker  which  is  a
 subsidiary  corporation of, or a corporation affiliated with, any corpo-
 ration insured, received commissions for the negotiation or  procurement
 of any policy or contract of insurance for the insured.
   (c)  THIS SECTION SHALL NOT PROHIBIT ANY INSURER FROM OFFERING PARTIC-
 IPATION IN A LOSS PREVENTION PROGRAM THAT PROMOTES AND  INCENTIVES  SAFE
 DRIVING  BEHAVIOR  WITH POINTS-BASED REWARDS SO LONG AS PARTICIPATION IN
 SUCH PROGRAM IS OFFERED BOTH TO MEMBERS OF THE GENERAL PUBLIC AND TO THE
 INSURER'S POLICYHOLDERS.
   (D) This  section  shall  not  prohibit  any  insurer  from  equitably
 distributing  to  its  policyholders  dividends  payable from surplus on
 earned premiums, nor prohibit the return at any time during the term  or
 at the termination of the contract of insurance of dividends, savings or
 the  unused  or  unabsorbed  portion of premiums and premium deposits to
 policyholders of a mutual insurer or  to  subscribers  of  a  reciprocal
 insurer, nor prohibit any insurer or insurance agent from paying commis-
 sions  to  a  licensed  insurance  broker  for  negotiating  a policy or
 contract of insurance, nor prohibit any licensed insurance  broker  from
 sharing  or  dividing  a  commission  earned or received by him with any
 other licensed insurance broker or brokers who shall have aided  him  in
 respect to the insurance for the negotiation of which the commission has
 been earned or paid.
   [(d)]  (E)  This  section  shall  not prohibit the making of temporary
 contracts of insurance, either by temporary binders or other  memoranda,
 if  the  premium  applicable  to the insurance shall be due and shall be
 paid for the time during which the insurance is in force  by  virtue  of
 the temporary contract.
   [(e)]  (F)  This  section shall not apply to any policy or contract of
 reinsurance nor to any contract or policy of  life  insurance,  accident
 insurance  or  health  insurance  which  is subject to the provisions of
 section four thousand two hundred twenty-four of this  chapter,  nor  to
 any  contract  or  policy  of  marine insurance, other than contracts or
 policies of automobile insurance, or of marine protection and  indemnity
 insurance,  nor  to  any  insurance  contract,  or  rate of insurance in
 connection with any insurance contract either against loss or damage to,
 or legal liability in  connection  with,  any  property  located  wholly
 outside  of  this state or any activity carried on outside of this state
 or any motor vehicle or aircraft principally garaged and used outside of
 this state.
   [(f)] (G) Any person or corporation violating the provisions  of  this
 section  shall,  in addition to all other penalties provided by law, pay
 to the people of this state as a penalty the sum of five hundred dollars
 for each such violation.
   § 2. This act shall take effect immediately.