S T A T E O F N E W Y O R K
________________________________________________________________________
5718--B
2023-2024 Regular Sessions
I N A S S E M B L Y
March 22, 2023
___________
Introduced by M. of A. KELLES, FAHY, LEVENBERG, GONZALEZ-ROJAS, ARDILA,
McMAHON, OTIS, BRONSON, LUNSFORD, EPSTEIN, CLARK, SHRESTHA, BURDICK,
REYES, CONRAD, SHIMSKY, STIRPE, JACOBSON, SIMONE, STECK, BURGOS, BORES
-- Multi-Sponsored by -- M. of A. SIMON -- read once and referred to
the Committee on Insurance -- committee discharged, bill amended,
ordered reprinted as amended and recommitted to said committee --
again reported from said committee with amendments, ordered reprinted
as amended and recommitted to said committee
AN ACT to amend the insurance law and the vehicle and traffic law, in
relation to owner's policies of liability insurance issued by a risk
retention group not chartered within this state
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Section 5913 of the insurance law, as added by chapter 109
of the laws of 1988, is amended to read as follows:
§ 5913. Financial responsibility. [Wherever] EXCEPT AS PROVIDED IN
SECTIONS THREE HUNDRED ELEVEN AND THREE HUNDRED SEVENTY OF THE VEHICLE
AND TRAFFIC LAW, WHEREVER pursuant to the laws of this state or any
political subdivision of this state a demonstration of financial respon-
sibility is required as a condition for obtaining a license or permit to
undertake specified activities, if any such requirement may not be
satisfied by obtaining insurance coverage from an insurer not authorized
to do business in this state, such requirement may not be satisfied by
purchasing insurance from a risk retention group not chartered in this
state. EVERY INSURANCE POLICY ISSUED BY A RISK RETENTION GROUP NOT
CHARTERED IN THIS STATE PURSUANT TO SECTIONS THREE HUNDRED ELEVEN AND
THREE HUNDRED SEVENTY OF THE VEHICLE AND TRAFFIC LAW SHALL CONTAIN THE
NOTICE SET FORTH IN SECTION FIVE THOUSAND NINE HUNDRED FIVE OF THIS
ARTICLE.
§ 2. Paragraphs (b) and (c) of subdivision 4 of section 311 of the
vehicle and traffic law, paragraph (c) as amended by chapter 200 of the
laws of 1974, are amended to read as follows:
(b) In the case of a vehicle registered in this state, a policy issued
by (I) an insurer duly authorized to transact business in this state OR
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD10375-11-3
A. 5718--B 2
(II) A RISK RETENTION GROUP NOT CHARTERED IN THIS STATE BUT WHICH IS
REGISTERED WITH THE SUPERINTENDENT UNDER THE FEDERAL LIABILITY RISK
RETENTION ACT OF 1986, COMPRISED ENTIRELY OF ORGANIZATIONS THAT ARE
TAX-EXEMPT UNDER SECTION 501(C)(3) OF THE FEDERAL INTERNAL REVENUE CODE
AND WHERE THE RISK RETENTION GROUP QUALIFIES AS A CHARITABLE RISK POOL
UNDER SECTION 501(N) OF THE FEDERAL INTERNAL REVENUE CODE; or
(c) In the case of a vehicle lawfully registered in another state, or
in both this state and another state, [either] (I) a policy issued by an
authorized insurer, or (II) A RISK RETENTION GROUP NOT CHARTERED IN THIS
STATE BUT WHICH IS REGISTERED WITH THE SUPERINTENDENT UNDER THE FEDERAL
LIABILITY RISK RETENTION ACT OF 1986, COMPRISED ENTIRELY OF ORGANIZA-
TIONS THAT ARE TAX-EXEMPT UNDER SECTION 501(C)(3) OF THE FEDERAL INTER-
NAL REVENUE CODE AND WHERE THE RISK RETENTION GROUP QUALIFIES AS A CHAR-
ITABLE RISK POOL UNDER SECTION 501(N) OF THE FEDERAL INTERNAL REVENUE
CODE, OR (III) a policy issued by an unauthorized insurer authorized to
transact business in another state if such unauthorized insurer files
with the commissioner in form to be approved by [him] THEM a statement
consenting to service of process and declaring its policies shall be
deemed to be varied to comply with the requirements of this article; and
§ 3. The opening paragraph of subdivision 5 of section 311 of the
vehicle and traffic law, as amended by chapter 569 of the laws of 1981,
is amended to read as follows:
The term "certificate of insurance" shall mean any evidence issued by
or on behalf of an insurance company duly authorized to transact busi-
ness in this state, OR A RISK RETENTION GROUP AUTHORIZED TO ISSUE AN
OWNER'S POLICY OF LIABILITY INSURANCE PURSUANT TO SUBDIVISION FOUR OF
THIS SECTION, stating in such form as the commissioner may prescribe or
approve that such company OR SUCH RISK RETENTION GROUP has issued an
owner's policy of liability insurance on the motor vehicle or vehicles
designated therein. Such certificate shall contain information as
required by the commissioner including at least the following except as
otherwise provided:
§ 4. Subdivision 10 of section 311 of the vehicle and traffic law, as
amended by chapter 103 of the laws of 1972, is amended to read as
follows:
10. "Insurance Identification Card" shall mean a card issued by or on
behalf of an insurance company or bonding company duly authorized to
transact business in this state, OR A RISK RETENTION GROUP AUTHORIZED TO
ISSUE AN OWNER'S POLICY OF LIABILITY INSURANCE PURSUANT TO SUBDIVISION
FOUR OF THIS SECTION, stating in such form as the commissioner may
prescribe or approve that such company OR SUCH RISK RETENTION GROUP has
issued an owner's policy of liability insurance or a financial security
bond on the motor vehicle or vehicles designated therein. Such card
shall contain such information and shall be valid during such period as
may be prescribed by the commissioner. If an owner shall have filed a
financial security deposit, or shall have qualified as a self-insurer
under section three hundred sixteen of this [chapter] ARTICLE, the term
"insurance identification card" shall mean a card issued by the depart-
ment which evidences that such deposit has been filed or that such owner
has so qualified.
§ 5. The opening paragraph of subdivision 1 of section 370 of the
vehicle and traffic law, as amended by chapter 20 of the laws of 2002
and as further amended by section 104 of part A of chapter 62 of the
laws of 2011, is amended to read as follows:
Every person, firm, association or corporation engaged in the business
of carrying or transporting passengers for hire in any motor vehicle or
A. 5718--B 3
motorcycle, except street cars, and motor vehicles or motorcycles owned
and operated by a municipality, and except as otherwise provided in this
section, which shall be operated over, upon or along any public street
or highway of the state of New York shall file with the commissioner of
motor vehicles for each motor vehicle or motorcycle intended to be so
operated evidence, in such form as the commissioner may prescribe, of a
corporate surety bond or a policy of insurance[,]: (A) approved as to
form by the superintendent of financial services in a company authorized
to do business in the state, approved by the superintendent as to
solvency and responsibility[,]; OR (B) A RISK RETENTION GROUP NOT CHAR-
TERED IN THIS STATE BUT WHICH IS REGISTERED WITH THE SUPERINTENDENT OF
FINANCIAL SERVICES UNDER THE FEDERAL LIABILITY RISK RETENTION ACT OF
1986, COMPRISED ENTIRELY OF ORGANIZATIONS THAT ARE TAX-EXEMPT UNDER
SECTION 501(C)(3) OF THE FEDERAL INTERNAL REVENUE CODE AND WHERE THE
RISK RETENTION GROUP QUALIFIES AS A CHARITABLE RISK POOL UNDER SECTION
501(N) OF THE FEDERAL INTERNAL REVENUE CODE. SUCH SURETY BOND OR POLICY
OF INSURANCE SHALL BE conditioned for the payment of a minimum sum,
hereinafter called minimum liability, on a judgment or judgments for
damages, including damages for care and loss of services, because of
bodily injury to, or death of any one person in any one accident, and
subject to such minimum liability a maximum sum, hereinafter called
maximum liability on a judgment or judgments for damages, including
damages for care and loss of services because of bodily injury to, or
death of two or more persons in any one accident and for the payment of
a minimum sum, called minimum liability on all judgments for damages
because of injury to or destruction of property of others in any one
accident, recovered against such person, firm, association or corpo-
ration upon claims arising out of the same transaction or transactions
connected with the same subject of action, to be apportioned ratably
among the judgment creditors according to the amount of their respective
judgments for damage or injury caused in the operation, maintenance, use
or the defective construction of such motor vehicle or motorcycle as
follows:
§ 6. Three years after the effective date of this act, the superinten-
dent of financial services, in consultation with the commissioner of
motor vehicles, shall study the impact of this act to determine the
efficacy of risk retention groups not chartered in this state issuing
vehicle insurance policies. Such study shall examine certain factors,
including, but not limited to: the quality and practicability of cover-
age on automotive accidents covered under such insurance policies, the
magnitude of need and interest in these types of insurance policies
across the state, customer satisfaction and fiscal surety using such
policies, the ability of the state to regulate such policies through the
federal limited risk retention act, and other data as is practicable
that would assess the potential impact on nonprofits that could be
covered by the expansion of eligibility of these policies for organiza-
tions that are tax-exempt under section 501(c)(3) of the federal inter-
nal revenue code. Such superintendent shall report the findings and any
recommendations of such study to the governor and the legislature no
later than four years after the effective date of this act.
§ 7. This act shall take effect on the one hundred eightieth day
after it shall have become a law.