NY State Senate Bill 2021-S5351

Senate Bill S5351

2021-2022 Legislative Session

Requires public vessels which carry passengers to be covered by insurance or a surety bond covering injury or death to the passengers

download bill text pdf

Archive: Last Bill Status - In Senate Committee Cultural Affairs, Tourism, Parks And Recreation 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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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 05, 2022	referred to cultural affairs, tourism, parks and recreation
Mar 02, 2021	referred to cultural affairs, tourism, parks and recreation

2021-S5351 (ACTIVE) - Details

See Assembly Version of this Bill:: A4951
Current Committee:: Senate Cultural Affairs, Tourism, Parks And Recreation
Law Section:: Navigation Law
Laws Affected:: Amd §50, add §§51 & 52, Nav L
Versions Introduced in Other Legislative Sessions:: 2017-2018: S6829
2019-2020: S2022, A8775
2023-2024: S500, A3096

2021-S5351 (ACTIVE) - Summary

Requires public vessels which carry passengers to be covered by insurance or a surety bond covering injury or death to the passengers.

2021-S5351 (ACTIVE) - Sponsor Memo

                                
 
BILL NUMBER: S5351

SPONSOR: STEC
 
TITLE OF BILL:

An act to amend the navigation law, in relation to requiring certain
policies of insurance for public vessels which carry passengers

 
PURPOSE:

Requires the owners of public vessels carrying passengers operating in
New York State to carry marine protection and indemnity insurance from
an insurance carrier authorized to do business in New York State or a
licensed excess line broker regulated by the Department of Financial
Services.

 
SUMMARY OF PROVISIONS:

Section one of the bill creates a new Section 51 of the Navigation Law,
which requires owners of public vessels carrying passengers operating in
New York state to obtain from an insurance carrier authorized to do

business in New York State or through an excess line broker regulated by
the Department of Financial Services, "marine protection and indemnity
insurance" as defined in the Insurance Law, with a minimum coverage of
one million dollars per occurrence (owners are free to obtain more if
they so desire). It also makes the failure to do so a misdemeanor.

Section two of the bill requires owners of public vessels seeking a
certificate of inspection under the Navigation Law to submit proof of
liability insurance.

Section three of the bill requires owners of public vessels to display
proof of insurance, as well as provide such proof to any person who has
suffered personal injury or property damage as a result of the operation
of such public vessel.

Section four of the bill sets forth the penalty for operating a public
vessel without liability insurance, which is a fine of $5,000 to
$10,000, and/or imprisonment for not more than ninety days.

Section five provides an additional penalty for operating without
liability insurance, which is revocation of the inspection certificate
for one year.

Sections six and seven require inspectors to ascertain whether the
vessel under inspection has the insurance required under the act and to
note the particulars of the insurance on the certificate of inspection.

Section eight and nine amend the insurance law in relation to marine
protection and indemnity insurance.

Section ten makes New York State law controlling with respect to the
rights and obligations arising under insurance policies required under
the act.

Section eleven amends the insurance law in relation to what can be
regarded as "Basic kinds of insurance."


Section twelve specifically authorizes excess line brokers to place
marine and indemnity insurance.

Section thirteen is the effective date (sixty days after enactment).

 
JUSTIFICATION:

The recent investigation of a Panamanian global money-laundering and tax
evasion scheme revealed that it was linked to a fake $2 million liabil-
ity insurance policy held by the owners of the Ethan Allen tour boat.
The tragic capsizing of the Ethan Allen on Lake George, on October 2,
2005, resulted in the deaths of 20 individuals. The Ethan Allen owner
discovered soon after the accident that the insurance policy he bought
was backed up by non-existent assets.

This bill addresses the current gap in law as there is currently no
requirement that public vessels carrying passengers carry liability
insurance. It also requires the insurance be purchased from an insurance
carrier authorized to do business in New York state or thorough a
licensed excess line broker regulated by the Department of Financial to
eliminate fraud. This bill is necessary to enhance the safety and secu-
rity of the public who utilize public vessels such as tour boats and who
expect such vessels to be insured just as any other form of commercial
transportation.

 
LEGISLATIVE HISTORY:

2020/2019: S2022 referred to Cultural Affairs, Tourism, Parks and Recre-
ation; A8775 referred to Insurance

2018/2017: S6829 referred to Cultural Affairs, Tourism, Parks and Recre-
ation

 
FISCAL IMPLICATIONS:

None.

 
EFFECTIVE DATE:
Sixty days after enactment.

2021-S5351 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   5351
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                               March 2, 2021
                                ___________
 
 Introduced  by  Sen.  STEC  --  read twice and ordered printed, and when
   printed to be committed to the Committee on Cultural Affairs, Tourism,
   Parks and Recreation
 
 AN ACT to amend the navigation law, in  relation  to  requiring  certain
   policies of insurance for public vessels which carry passengers

   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Section 50 of the navigation law, as amended by chapter 672
 of the laws of 1962, is amended to read as follows:
   § 50. Owners to notify inspector and apply for inspection. It shall be
 the duty of the owner of a public vessel which he intends to operate  on
 the navigable waters of the state to notify the inspector of such inten-
 tion  at  least  one  month  before it is desired to place the vessel in
 operation and to request an inspection of such vessel. Upon  receipt  of
 such  notification  the  inspector  shall  enter  the application on the
 records of his office. A temporary permit to operate such vessel pending
 inspection may be issued by the inspector, if he finds through  documen-
 tary  evidence  that such vessel is properly equipped and manned for the
 safety of life and property. No public vessel shall be used or  operated
 without  a  certificate  of inspection or a temporary permit as [herein]
 provided IN THIS SECTION.   NO CERTIFICATE OF  INSPECTION  OR  TEMPORARY
 PERMIT  SHALL  BE  ISSUED  UNLESS  THE OWNER OF A PUBLIC VESSEL PRODUCES
 PROOF OF INSURANCE TO THE INSPECTOR IN ACCORDANCE WITH SECTION FIFTY-ONE
 OF THIS PART.
   § 2. The navigation law is amended by adding two new sections  51  and
 52 to read as follows:
   §  51.  LIABILITY  INSURANCE ON PUBLIC VESSELS. 1. EVERY PUBLIC VESSEL
 CERTIFIED TO CARRY PASSENGERS WHICH IS OPERATED ON THE NAVIGABLE  WATERS
 OF  THE  STATE, EXCEPT VESSELS WHICH NAVIGATE ON WATERS WHICH THE UNITED
 STATES EXERCISES ACTIVE CONTROL, SHALL BE COVERED BY A CORPORATE  SURETY
 BOND  OR  A  POLICY  OF PROTECTION AND INDEMNITY INSURANCE, ISSUED BY AN
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD09058-01-1

 S. 5351                             2
 
 INSURER AUTHORIZED TO ISSUE POLICIES  IN  THIS  STATE  PURSUANT  TO  THE
 INSURANCE  LAW.  PUBLIC VESSELS CERTIFIED BY THE OFFICE OF PARKS, RECRE-
 ATION AND HISTORIC PRESERVATION TO CARRY PASSENGERS SHALL PROVIDE COVER-
 AGE  OF  AT  LEAST  ONE  MILLION DOLLARS PER OCCURRENCE FOR INJURY TO OR
 DEATH OF ANY PERSON ARISING OUT  OF  THE  NEGLIGENT  OPERATION  OF  SAID
 PUBLIC VESSEL.
   EVERY  SUCH  BOND  OR INSURANCE POLICY SHALL CONTAIN A PROVISION FOR A
 CONTINUING LIABILITY THEREUNDER, NOTWITHSTANDING ANY  RECOVERY  THEREON,
 AND  SHALL  BE  IN  FULL  FORCE AND EFFECT WHENEVER THE PUBLIC VESSEL IS
 UNDERWAY.
   2. NO POLICY OR CONTRACT SHALL BE ISSUED OR DELIVERED  IN  THIS  STATE
 PURSUANT  TO THIS SECTION UNLESS IT CONTAINS IN SUBSTANCE THE PROVISIONS
 OF SECTION THREE HUNDRED TWENTY OF THE INSURANCE LAW.
   3. PROOF OF BOND OR  INSURANCE  REQUIRED  BY  THIS  SECTION  SHALL  BE
 PRODUCED  AND  DISPLAYED  BY THE OWNER OR OPERATOR OF SUCH PUBLIC VESSEL
 UPON  THE  REQUEST  OF  ANY  PERSON  HAVING  AUTHORITY  TO  ENFORCE  THE
 PROVISIONS  OF  THIS CHAPTER. THE FAILURE TO PRODUCE SUCH PROOF UPON THE
 REQUEST OF ANY SUCH PERSON SHALL NOT BE AN OFFENSE BUT SHALL BE PRESUMP-
 TIVE EVIDENCE THAT THE PUBLIC VESSEL IS BEING  OPERATED  WITHOUT  HAVING
 SUCH BOND OR INSURANCE IN FORCE AND EFFECT.
   4.  NO OWNER OF A PUBLIC VESSEL SHALL OPERATE OR PERMIT THE SAME TO BE
 OPERATED UPON THE NAVIGABLE WATERS OF THIS STATE WITHOUT HAVING IN  FULL
 FORCE  AND  EFFECT  THE  LIABILITY  INSURANCE  COVERAGE REQUIRED BY THIS
 SECTION, AND NO PERSON SHALL OPERATE A PUBLIC VESSEL UPON THE  NAVIGABLE
 WATERS  OF  THIS STATE WITH KNOWLEDGE THAT SUCH INSURANCE IS NOT IN FULL
 FORCE AND EFFECT.
   5. OPERATION OF A PUBLIC VESSEL IN VIOLATION OF  THE  REQUIREMENTS  OF
 THIS  SECTION  SHALL  BE  PUNISHABLE AS A MISDEMEANOR IN ACCORDANCE WITH
 SECTION SEVENTY-THREE-B OF THIS ARTICLE.
   § 52. SELF-INSURERS. THE COMMISSIONER MAY, IN HIS OR  HER  DISCRETION,
 UPON  THE APPLICATION OF AN OWNER OF A PUBLIC VESSEL TO HAVE SUCH PUBLIC
 VESSEL CERTIFIED, ISSUE A CERTIFICATE OF SELF-INSURANCE WHEN HE  OR  SHE
 IS  REASONABLY SATISFIED THAT SUCH PERSON IS POSSESSED AND WILL CONTINUE
 TO BE POSSESSED  OF  THE  FINANCIAL  ABILITY  TO  RESPOND  TO  JUDGMENTS
 OBTAINED AGAINST SUCH PERSON, ARISING OUT OF THE OWNERSHIP, MAINTENANCE,
 USE OR OPERATION OF ANY SUCH PERSON'S PUBLIC VESSEL. UPON DUE NOTICE AND
 HEARING, THE COMMISSIONER MAY, IN HIS OR HER DISCRETION AND UPON REASON-
 ABLE GROUNDS, CANCEL A CERTIFICATE OF SELF-INSURANCE.
   §  3.  This  act shall take effect on the ninetieth day after it shall
 have become a law.

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