BILL NUMBER: S5761

SPONSOR: BRESLIN
 
TITLE OF BILL:

An act to amend the insurance law, in relation to removing the bonding
requirement for independent adjusters

 
PURPOSE OR GENERAL IDEA OF BILL:

To modernize the insurance law to remove an anachronistic provision
relating to a mandate upon independent adjusters

 
SUMMARY OF PROVISIONS:

Section one of the bill removes independent adjusters from the require-
ment that a bond be procured by a licensee and filed with the super-
intendent of financial services.

Section two provides for an immediate effective date.

              

 
JUSTIFICATION:

Section 2108 provides a range of requirements upon licensees holding
independent insurance adjuster licenses, among other licenses issued by
the Department of Financial Services. The requirement which is the
subject of this legislation requires prospective or renewing licensees
to post a bond issued by a surety in the amount of $ 1,000.00 with the
superintendent. It ostensibly is to assure the "faithful performance" of
the licensees. This provision, like others, harken to a day when
enforcement was a vastly different task for the regulator. However, with
the onset of the digital age, among other advances, the need to have a
bond "at risk" is no longer a major impetus to compelling compliant
behavior by licensees.

The bond requirement also has created a filing challenge for both the
licensee and the regulator. Delays have been occasioned when the bond
and the license have not been co-terminously provided to and approved by
the regulator simply because there are several other people necessarily
in the process. Removing this filing requirement will streamline the
filing process without sacrificing any meaningful enforcement tool and
remove a cost of doing business as an independent adjuster in the State.

 
PRIOR LEGISLATIVE HISTORY:

2020: A.10592-Remained in Insurance.

 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:

None to the State.

 
EFFECTIVE DATE:
Immediate.