S T A T E O F N E W Y O R K
________________________________________________________________________
895
2021-2022 Regular Sessions
I N S E N A T E
(PREFILED)
January 6, 2021
___________
Introduced by Sen. LIU -- read twice and ordered printed, and when
printed to be committed to the Committee on Rules
AN ACT to amend the insurance law, in relation to group policies for
certain motor vehicles engaged in the business of carrying or trans-
porting passengers for hire
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Section 3457 of the insurance law, as added by a chapter of
the laws of 2020, amending the insurance law relating to group policies
for motor vehicles engaged in the business of carrying and transporting
passengers for-hire, as proposed in legislative bills numbers S. 8437
and A. 9761-A, is amended to read as follows:
§ 3457. [Group fleet policy for motor vehicles engaged in the business
of carrying or transporting passengers for-hire. (a) (i) Every author-
ized insurer that issues or issues for delivery in this state a policy
of commercial risk insurance insuring against losses or liabilities
arising out of the ownership, operation, or use of a motor vehicle,
shall establish and offer a group fleet policy insuring against the
losses or liabilities arising out of the ownership of motor vehicles
engaged in the business of carrying or transporting passengers for-hire,
having a seating capacity of not less than eight passengers. Such group
fleet policy shall provide coverage for more than one vehicle through
one policy. Such group fleet policies shall be subject to all laws,
rules and regulations applicable to policies of commercial risk insur-
ance insuring against losses or liabilities arising out of the owner-
ship, operation, or use of a motor vehicle engaged in the business of
carrying or transporting passengers for-hire, having a seating capacity
of not less than eight passengers, including but not limited to laws,
rules and regulations establishing financial responsibility require-
ments.
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD07189-01-1
S. 895 2
(ii) For the purpose of this section, a "group fleet policy" shall
mean, a policy issued by an authorized insurer in this state insuring
against losses or liabilities arising out of ownership, operation, or
use of a motor vehicle engaged in the business of carrying or transport-
ing passengers for-hire, having a seating capacity of not less than
eight passengers, and such policy shall cover more than one vehicle.
(b) The group fleet policy may be issued to:
(i) Any person, firm, association, corporation or other entity which
shall be deemed the policyholder, where the policy insures the for-hire
motor vehicles owned by such person, firm, association, corporation or
other entity; or
(ii) An association where such association shall be deemed the policy-
holder; where all the eligible members of the association have the same
profession, trade, or occupation, and the association has been organized
and maintained in good faith for purposes principally other than that of
obtaining insurance, and has been in active existence for at least two
years, and where the policy insures the members of the association.
(c) An authorized insurer issuing policies pursuant to this section
shall provide a multiple vehicle reduction based on the number of motor
vehicles that will be covered under such policy. Such reduction shall be
based on actuarially appropriate reductions as provided for in
subsection (e) of this section. Each insurer required to provide such
reduction shall submit a report to the superintendent at the end of each
calendar year identifying the number of policies eligible for such
discount and the number of policies to which such discount has been
applied.
(d) A member of an association shall not be deemed to be an employee
of such association solely because such member is covered under a group
fleet policy issued to an association pursuant to this section.
(e) Authorized insurers required to establish group fleet policies
pursuant to this section shall make such policies available for purchase
no later than January first, two thousand twenty-one.
(f) The superintendent shall provide for an actuarially appropriate
reduction in the rates of premiums for commercial risk insurance appli-
cable to motor vehicles engaged in the business of carrying or trans-
porting passengers for-hire, having a seating capacity of not less than
eight passengers, for policies that provide coverage for multiple vehi-
cles. Nothing in this section shall be construed to authorize any
increase in premium rates for any other policy issued by such authorized
insurer as a result of any group fleet policy premium rate.
(g) The superintendent may promulgate any rules and regulations neces-
sary to implement the provisions of this section.]
GROUP INSURANCE POLICIES FOR CERTAIN FOR HIRE MOTOR VEHICLES. (A) FOR
PURPOSES OF THIS SECTION, THE FOLLOWING DEFINITIONS SHALL APPLY:
(1) "CERTIFICATE" OR "CERTIFICATE OF INSURANCE" MEANS ANY POLICY,
CONTRACT OR OTHER EVIDENCE OF INSURANCE, OR ENDORSEMENT THERETO, ISSUED
TO A GROUP MEMBER UNDER A FOR HIRE MOTOR VEHICLE GROUP POLICY.
(2) "FOR HIRE MOTOR VEHICLE" OR "VEHICLE" MEANS A MOTOR VEHICLE
ENGAGED IN THE BUSINESS OF CARRYING OR TRANSPORTING PASSENGERS FOR HIRE,
HAVING A SEATING CAPACITY OF NOT LESS THAN EIGHT PASSENGERS, EXCLUDING
THE DRIVER.
(3) "FOR HIRE MOTOR VEHICLE GROUP POLICY" OR "GROUP POLICY" MEANS A
GROUP POLICY, INCLUDING CERTIFICATES ISSUED TO THE GROUP MEMBERS, WHERE
THE GROUP POLICY PROVIDES INSURANCE TO THE GROUP MEMBERS OR BOTH THE
GROUP POLICYHOLDER AND THE GROUP MEMBERS OF THE TYPE DESCRIBED IN PARA-
S. 895 3
GRAPH TWELVE, THIRTEEN, FOURTEEN, OR NINETEEN OF SUBSECTION (A) OF
SECTION ONE THOUSAND ONE HUNDRED THIRTEEN OF THIS CHAPTER.
(4) "GROUP MEMBER" MEANS THE OWNER OF A FOR HIRE MOTOR VEHICLE.
(5) "GROUP POLICYHOLDER" MEANS A SPONSORING ENTITY.
(6) "OWNER" SHALL HAVE THE SAME MEANING AS SET FORTH IN SECTION ONE
HUNDRED TWENTY-EIGHT OF THE VEHICLE AND TRAFFIC LAW.
(7) "SPONSORING ENTITY" MEANS:
(A) AN ASSOCIATION OR OTHER ORGANIZATION, OR A TRUSTEE OR TRUSTEES OF
A FUND ESTABLISHED, CREATED, OR MAINTAINED FOR THE BENEFIT OF ONE OR
MORE ASSOCIATIONS OR OTHER ORGANIZATIONS, WHERE ALL THE ELIGIBLE MEMBERS
OF THE ASSOCIATION OR ASSOCIATIONS OR OTHER ORGANIZATION OR ORGANIZA-
TIONS HAVE THE SAME PROFESSION, TRADE, OR OCCUPATION, AND THE ASSOCI-
ATION OR ASSOCIATIONS OR OTHER ORGANIZATION OR ORGANIZATIONS HAVE BEEN
ORGANIZED AND MAINTAINED IN GOOD FAITH FOR PURPOSES PRINCIPALLY OTHER
THAN THAT OF OBTAINING INSURANCE, AND HAVE BEEN IN ACTIVE EXISTENCE FOR
AT LEAST TWO YEARS;
(B) AN ENTITY THAT OWNS FOR HIRE MOTOR VEHICLES AND LEASES THEM TO
DRIVERS; OR
(C) ANY OTHER ENTITY WHERE THE SUPERINTENDENT HAS DETERMINED IN A
REGULATION THAT THE MEMBERS ARE ENGAGED IN A COMMON ENTERPRISE, OR HAVE
AN ECONOMIC OR SOCIAL AFFINITY OR RELATIONSHIP, AND THAT THE ISSUANCE OF
THE GROUP POLICY WOULD NOT BE CONTRARY TO THE BEST INTERESTS OF THE
PUBLIC.
(B) AN AUTHORIZED INSURER MAY ISSUE OR ISSUE FOR DELIVERY IN THIS
STATE A GROUP POLICY TO A SPONSORING ENTITY AS A GROUP POLICYHOLDER ONLY
IN ACCORDANCE WITH THE PROVISIONS OF THIS SECTION.
(C)(1) A GROUP POLICY SHALL PROVIDE COVERAGE IN SATISFACTION OF THE
FINANCIAL RESPONSIBILITY REQUIREMENTS SET FORTH IN SECTION THREE THOU-
SAND FOUR HUNDRED TWENTY OF THIS ARTICLE, SECTION THREE HUNDRED SEVENTY
OF THE VEHICLE AND TRAFFIC LAW, ARTICLE FIFTY-ONE OF THIS CHAPTER, AND
SUCH OTHER REQUIREMENTS OR REGULATIONS THAT MAY APPLY FOR THE PURPOSES
OF SATISFYING THE FINANCIAL RESPONSIBILITY REQUIREMENTS WITH RESPECT TO
THE USE OR OPERATION OF A FOR HIRE MOTOR VEHICLE.
(2) A GROUP POLICY MAY PROVIDE:
(A) COVERAGE FOR LIMITS HIGHER THAN THE MINIMUM LIMITS REQUIRED PURSU-
ANT TO SECTION THREE HUNDRED SEVENTY OF THE VEHICLE AND TRAFFIC LAW AND
PARAGRAPH TWO OF SUBSECTION (F) OF SECTION THREE THOUSAND FOUR HUNDRED
TWENTY OF THIS ARTICLE;
(B) SUPPLEMENTAL SPOUSAL LIABILITY INSURANCE PURSUANT TO SUBSECTION
(G) OF SECTION THREE THOUSAND FOUR HUNDRED TWENTY OF THIS ARTICLE; AND
(C) MOTOR VEHICLE PHYSICAL DAMAGE COVERAGE AS DESCRIBED IN PARAGRAPH
NINETEEN OF SUBSECTION (A) OF SECTION ONE THOUSAND ONE HUNDRED THIRTEEN
OF THIS CHAPTER.
(3) A GROUP POLICY, INCLUDING CERTIFICATES, SHALL BE ISSUED BY AN
AUTHORIZED INSURER.
(4) A POLICYHOLDER ALSO MAY BE AN INSURED UNDER A GROUP POLICY.
(D) THE PREMIUM FOR THE GROUP POLICY, INCLUDING CERTIFICATES, MAY BE
PAID BY THE GROUP POLICYHOLDER FROM THE FUNDS CONTRIBUTED WHOLLY BY THE
GROUP MEMBERS OR JOINTLY BY THE GROUP POLICYHOLDER AND THE GROUP
MEMBERS.
(E) EACH POLICY WRITTEN PURSUANT TO THIS SECTION SHALL PROVIDE PER
OCCURRENCE LIMITS OF COVERAGE FOR EACH GROUP MEMBER IN AN AMOUNT NOT
LESS THAN THAT REQUIRED BY THIS ARTICLE AND MAY PROVIDE COVERAGE FOR
LIMITS HIGHER THAN THE MINIMUM LIMITS REQUIRED PURSUANT TO LAW.
(F)(1) THE INSURER SHALL BE RESPONSIBLE FOR MAILING OR DELIVERY OF A
CERTIFICATE OF INSURANCE TO EACH GROUP MEMBER INSURED UNDER THE GROUP
S. 895 4
POLICY. THE INSURER SHALL ALSO BE RESPONSIBLE FOR THE MAILING OR DELIV-
ERY TO EACH GROUP MEMBER OF AN AMENDED CERTIFICATE OF INSURANCE OR
ENDORSEMENT TO THE CERTIFICATE WHENEVER THERE IS A CHANGE IN LIMITS,
CHANGE IN TYPE OF COVERAGE, ADDITION, REDUCTION, OR ELIMINATION OF
COVERAGE OR ADDITION OF AN EXCLUSION, UNDER THE GROUP POLICY OR CERTIF-
ICATE.
(2) THE CERTIFICATE SHALL CONTAIN IN SUBSTANCE ALL MATERIAL TERMS AND
CONDITIONS OF COVERAGE AFFORDED TO GROUP MEMBERS, UNLESS THE GROUP POLI-
CY IS INCORPORATED BY REFERENCE AND A COPY OF THE GROUP POLICY ACCOMPA-
NIES THE CERTIFICATE.
(G) A GROUP POLICYHOLDER SHALL COMPLY WITH THE PROVISIONS OF SECTION
TWO THOUSAND ONE HUNDRED TWENTY-TWO OF THIS CHAPTER, IN THE SAME MANNER
AS AN INSURANCE AGENT OR INSURANCE BROKER, IN ANY ADVERTISEMENT, SIGN,
PAMPHLET, CIRCULAR, CARD, OR OTHER PUBLIC ANNOUNCEMENT REFERRING TO
COVERAGE UNDER A GROUP POLICY OR CERTIFICATE.
(H) A GROUP POLICY SHALL NOT BE SUBJECT TO SECTION THREE THOUSAND FOUR
HUNDRED TWENTY-FIVE OR SECTION THREE THOUSAND FOUR HUNDRED TWENTY-SIX OF
THIS ARTICLE, PROVIDED THAT THE FOLLOWING REQUIREMENTS SHALL APPLY WITH
REGARD TO TERMINATION OF COVERAGE:
(1) AN INSURER MAY CANCEL A GROUP POLICY OR CERTIFICATE ONLY IF
CANCELLATION IS BASED ON ONE OR MORE OF THE REASONS SET FORTH IN SUBPAR-
AGRAPH (A) THROUGH (D) OR (F) THROUGH (H) OF PARAGRAPH ONE OF SUBSECTION
(C) OF SECTION THREE THOUSAND FOUR HUNDRED TWENTY-SIX OF THIS ARTICLE;
PROVIDED, HOWEVER, THAT:
(A) AN INSURER MAY CANCEL AN INDIVIDUAL CERTIFICATE IF THE DRIVER'S
LICENSE OF THE GROUP MEMBER INSURED UNDER THAT CERTIFICATE IS SUSPENDED
OR REVOKED DURING THE PERIOD OF COVERAGE, OTHER THAN A SUSPENSION ISSUED
PURSUANT TO SUBDIVISION ONE OF SECTION FIVE HUNDRED TEN-B OF THE VEHICLE
AND TRAFFIC LAW OR ONE OR MORE ADMINISTRATIVE SUSPENSIONS ARISING FROM
THE SAME INCIDENT THAT HAS OR HAVE BEEN TERMINATED PRIOR TO THE EFFEC-
TIVE DATE OF THE CANCELLATION; AND
(B) AN ACT OR OMISSION BY A GROUP MEMBER THAT WOULD CONSTITUTE THE
BASIS FOR CANCELLATION OF AN INDIVIDUAL CERTIFICATE SHALL NOT CONSTITUTE
THE BASIS FOR CANCELLATION OF THE GROUP POLICY.
(2) AN INSURER'S CANCELLATION OF A GROUP POLICY, INCLUDING ALL CERTIF-
ICATES, SHALL NOT BECOME EFFECTIVE UNTIL THIRTY DAYS AFTER THE INSURER
MAILS OR DELIVERS WRITTEN NOTICE OF CANCELLATION TO THE GROUP POLICY-
HOLDER AT THE MAILING ADDRESS SHOWN IN THE POLICY. THE INSURER SHALL
ALSO MAIL OR DELIVER WRITTEN NOTICE OF CANCELLATION OF THE GROUP POLICY,
INCLUDING ALL CERTIFICATES, TO THE GROUP MEMBER AT THE GROUP MEMBER'S
MAILING ADDRESS. SUCH CANCELLATION SHALL NOT BECOME EFFECTIVE UNTIL
THIRTY DAYS AFTER THE INSURER MAILS OR DELIVERS THE WRITTEN NOTICE TO
THE GROUP MEMBER.
(3)(A) A GROUP POLICYHOLDER MAY CANCEL A GROUP POLICY, INCLUDING ALL
CERTIFICATES, OR ANY INDIVIDUAL CERTIFICATE, FOR ANY REASON UPON AT
LEAST THIRTY DAYS WRITTEN NOTICE TO THE INSURER AND EACH GROUP MEMBER;
AND
(B) THE GROUP POLICYHOLDER SHALL MAIL OR DELIVER WRITTEN NOTICE TO
EACH AFFECTED GROUP MEMBER OF THE GROUP POLICYHOLDER'S CANCELLATION OF
THE GROUP POLICY OR CERTIFICATE AND THE EFFECTIVE DATE OF CANCELLATION.
THE GROUP POLICYHOLDER SHALL MAIL OR DELIVER THE WRITTEN NOTICE TO THE
GROUP MEMBER'S MAILING ADDRESS AT LEAST THIRTY DAYS PRIOR TO THE EFFEC-
TIVE DATE OF CANCELLATION.
(4)(A) UNLESS A GROUP POLICY PROVIDES FOR A LONGER POLICY PERIOD, THE
POLICY AND ALL CERTIFICATES SHALL BE ISSUED OR RENEWED FOR A ONE-YEAR
POLICY PERIOD.
S. 895 5
(B) THE GROUP POLICYHOLDER SHALL BE ENTITLED TO RENEW THE GROUP POLICY
AND ALL CERTIFICATES UPON TIMELY PAYMENT OF THE PREMIUM BILLED TO THE
GROUP POLICYHOLDER FOR THE RENEWAL, UNLESS:
(I) THE INSURER MAILS OR DELIVERS TO THE GROUP POLICYHOLDER AND ALL
GROUP MEMBERS WRITTEN NOTICE OF NONRENEWAL OR CONDITIONAL RENEWAL; AND
(II) THE INSURER MAILS OR DELIVERS THE WRITTEN NOTICE AT LEAST SIXTY,
BUT NOT MORE THAN ONE HUNDRED TWENTY DAYS, PRIOR TO THE EXPIRATION DATE
SPECIFIED IN THE POLICY OR, IF NO DATE IS SPECIFIED, THE NEXT ANNIVER-
SARY DATE OF THE POLICY.
(5) EVERY NOTICE OF CANCELLATION, NONRENEWAL, OR CONDITIONAL RENEWAL
SHALL SET FORTH THE SPECIFIC REASON OR REASONS FOR CANCELLATION, NONRE-
NEWAL, OR CONDITIONAL RENEWAL AND THE INSURER SHALL ALSO MAIL OR DELIVER
THE NOTICE TO THE INSURANCE PRODUCER THAT PROCURED THE GROUP POLICY WHEN
THE GROUP POLICY AND ANY CERTIFICATES ARE CANCELLED, NONRENEWED, OR
CONDITIONALLY RENEWED.
(6)(A) IF, PRIOR TO THE EFFECTIVE DATE OF CANCELLATION, NONRENEWAL, OR
CONDITIONAL RENEWAL OF THE GROUP POLICY, OR CANCELLATION OF A CERTIF-
ICATE, WHETHER INITIATED BY THE INSURER, GROUP POLICYHOLDER, OR GROUP
MEMBER IN REGARD TO THE GROUP MEMBER'S CERTIFICATE, COVERAGE ATTACHES
PURSUANT TO THE TERMS OF THE GROUP POLICY, THEN THE COVERAGE SHALL BE
EFFECTIVE UNTIL EXPIRATION OF THE APPLICABLE PERIOD OF COVERAGE PROVIDED
IN THE GROUP POLICY NOTWITHSTANDING THE CANCELLATION, NONRENEWAL OR
CONDITIONAL NONRENEWAL OF THE GROUP POLICY.
(B) NOTWITHSTANDING SUBPARAGRAPH (A) OF THIS PARAGRAPH, AN INSURER MAY
TERMINATE COVERAGE UNDER AN INDIVIDUAL CERTIFICATE ON THE EFFECTIVE DATE
OF CANCELLATION IF THE CERTIFICATE IS CANCELLED IN ACCORDANCE WITH THE
PROVISIONS OF PARAGRAPH ONE OF THIS SUBSECTION.
(I) AN INSURER SHALL NOT INCLUDE A MANDATORY ARBITRATION CLAUSE IN A
POLICY THAT PROVIDES FINANCIAL RESPONSIBILITY COVERAGE UNDER THIS
SECTION, EXCEPT AS PERMITTED IN SECTION FIVE THOUSAND ONE HUNDRED FIVE
OF THIS CHAPTER.
(J) THE SUPERINTENDENT MAY PROMULGATE REGULATIONS PERTAINING TO A FOR
HIRE MOTOR VEHICLE GROUP POLICY, INCLUDING REGULATIONS REGARDING
PAYMENTS OF DIVIDENDS OR RETROSPECTIVE PREMIUM REFUNDS, MINIMUM NUMBER
OF GROUP MEMBERS, AND OTHER REASONABLE LIMITATIONS.
§ 2. This act shall take effect on the same date and in the same
manner as a chapter of the laws of 2020, amending the insurance law
relating to group policies for motor vehicles engaged in the business of
carrying and transporting passengers for-hire, as proposed in legisla-
tive bills numbers S. 8437 and A. 9761-A, takes effect.