NY State Senate Bill 2023-S18

Current Bill Status - In Senate Committee Insurance 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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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 03, 2024	referred to insurance
Jan 04, 2023	referred to insurance

co-Sponsors

2023-S18 (ACTIVE) - Details

See Assembly Version of this Bill:: A418
Current Committee:: Senate Insurance
Law Section:: Insurance Law
Laws Affected:: Add §346, Ins L
Versions Introduced in Other Legislative Sessions:: 2019-2020: S8853, A10837
2021-2022: S847, A498

2023-S18 (ACTIVE) - Summary

Relates to requiring business interruption insurance to cover disease outbreaks as denying such coverage based on a disease outbreak is against public policy.

2023-S18 (ACTIVE) - Sponsor Memo

                                 
BILL NUMBER: S18

SPONSOR: GOUNARDES
 
TITLE OF BILL:

An act to amend the insurance law, in relation to requiring business
interruption insurance to cover disease outbreaks

 
PURPOSE OR GENERAL IDEA OF BILL:

This bill would require business interruption insurance offered to small
businesses and/or not-for profits of 250 or less employees to cover
disease outbreaks.

 
SUMMARY OF PROVISIONS:

Section 1 amends the insurance law by adding a new section 346.  Section
346 defines terms and declares that every clause or provision of insur-
ance insuring against loss or damage to property, which allows the
insurer to deny coverage based on a virus, bacterium or other microor-
ganism shall be null and void against public policy.  This bill applies
to businesses and not-for-profits covered by such a policy with less

than 250 eligible employees in the State of New York.

Section 346 provides that an insurer which indemnifies an insured who
has filed a claim pursuant to its provisions may apply to the Super-
intendent of the Department of Financial Services for relief and
reimbursement from funds collected and made available for this purpose
as provided in the bill, pursuant to an additional special purpose
assessment under the general scheme already established by law to
recover the general expenses of the Department of Financial Services as
the regulator of the insurance industry in this State.  The superinten-
dent shall establish procedures for the submission and qualification of
claims by insurers which are eligible for reimbursement, incorporating
such standards as are necessary to protect against the submission of
fraudulent claims by insureds, and appropriate safeguards for insurers
to employ in the review and payment of such claims.

Section 346 authorizes the superintendent to impose upon, distribute
among, and collect from insurance companies, other than life and health
insurance companies, the additional amounts as may be necessary to
recover the amounts paid pursuant to the bill.

Section 2 states that this act shall take effect immediately and shall
apply to all business interruption insurance claims filed by an insured
and all policies or contracts issued, renewed, modified, altered or
amended on and after such effective date.

 
JUSTIFICATION:

COVID-19 had a devastating impact on small business owners across the
state. Most small business owners had been paying for business inter-
ruption insurance premiums for years with the thinking that they would
have coverage if a business interruption of the nature caused by the
COVID-19 pandemic were to take place. Unfortunately most of them found
out when the pandemic hit and they filed a claim that their insurance
company refused to pay out these claims. As a consequence, many small
businesses across the state and particularly in New York City were
forced to close. This bill would help address this issue by stopping
insurance companies from refusing to pay out claims based on their virus
and bacterium exclusion.

 
PRIOR LEGISLATIVE HISTORY:

2022: S847 - Referred to Insurance

2021: S847 - Referred to Insurance

2020: S8853 - Referred to Rules

 
FISCAL IMPLICATIONS:

TBD

 
EFFECTIVE DATE:
Immediate

2023-S18 (ACTIVE) - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                    18
 
                        2023-2024 Regular Sessions
 
                             I N  S E N A T E
 
                                (PREFILED)
 
                              January 4, 2023
                                ___________
 
 Introduced  by Sens. GOUNARDES, MYRIE -- 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  requiring  business
   interruption insurance to cover disease outbreaks

   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1.  The insurance law is amended by adding a new  section  346
 to read as follows:
   §  346. BUSINESS INTERRUPTION INSURANCE; DISEASE OUTBREAK. (A) FOR THE
 PURPOSES OF THIS SECTION:
   (1) "BUSINESS" SHALL MEAN A BUSINESS REGISTERED WITH THE DEPARTMENT OF
 TAX AND FINANCE OR NOT-FOR-PROFIT CORPORATION REGISTERED WITH THE ATTOR-
 NEY GENERAL'S CHARITIES BUREAU.
   (2) "ELIGIBLE EMPLOYEE" SHALL MEAN A FULL-TIME EMPLOYEE  WHO  WORKS  A
 NORMAL WORK WEEK OF TWENTY-FIVE OR MORE HOURS.
   (3)  "INCOME"  SHALL  MEAN TRADITIONAL BUSINESS INCOME AS WELL AS NOT-
 FOR-PROFIT REVENUE FROM DONATIONS, SPONSORSHIPS, AND GRANTS.
   (4) "NET WRITTEN PREMIUMS RECEIVED" SHALL MEAN GROSS  DIRECT  PREMIUMS
 WRITTEN,  LESS RETURN PREMIUMS THEREON AND DIVIDENDS CREDITED OR PAID TO
 POLICYHOLDERS, AS REPORTED ON THE COMPANY'S ANNUAL FINANCIAL STATEMENT.
   (5) "PREMIUM TAXES" SHALL MEAN PAYMENTS REQUIRED UNDER SUBSECTION  (D)
 OF SECTION TWO THOUSAND ONE HUNDRED EIGHTEEN OF THIS CHAPTER.
   (B)  (1)  NOTWITHSTANDING ANY PROVISIONS OF LAW, RULE OR REGULATION TO
 THE CONTRARY, EVERY CLAUSE OR PROVISION OF A POLICY OF INSURANCE  INSUR-
 ING  AGAINST  LOSS  OR  DAMAGE  TO  PROPERTY, WHICH INCLUDES, BUT IS NOT
 LIMITED TO, THE LOSS OF USE AND OCCUPANCY AND BUSINESS INTERRUPTION  AND
 CONTINGENT  BUSINESS  INTERRUPTION,  WHICH  ALLOWS  THE  INSURER TO DENY
 COVERAGE BASED ON A VIRUS, BACTERIUM, OR OTHER MICROORGANISM THAT CAUSES
 DISEASE, ILLNESS, OR PHYSICAL DISTRESS OR THAT  IS  CAPABLE  OF  CAUSING
 DISEASE, ILLNESS, OR PHYSICAL DISTRESS SHALL BE NULL AND VOID AS AGAINST
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD00501-01-3
 S. 18                               2
 
 PUBLIC  POLICY;  PROVIDED, HOWEVER, THE REMAINING CLAUSES AND PROVISIONS
 OF THE CONTRACT SHALL REMAIN IN EFFECT FOR THE DURATION OF THE  CONTRACT
 TERM.
   (2)  THE  COVERAGE  REQUIRED  BY  THIS  SUBSECTION SHALL INDEMNIFY THE
 INSURED, SUBJECT TO THE LIMITS UNDER THE POLICY, FOR ANY LOSS  OF  BUSI-
 NESS OR BUSINESS INTERRUPTION AND CONTINGENT BUSINESS INTERRUPTION.
   (3)  THIS  SUBSECTION  SHALL APPLY TO POLICIES ISSUED TO INSUREDS WITH
 LESS THAN TWO HUNDRED FIFTY ELIGIBLE EMPLOYEES.
   (C)(1) AN INSURER, INCLUDING EXCESS LINES INSURERS, WHICH  INDEMNIFIES
 AN  INSURED  WHO  HAS  FILED  A CLAIM PURSUANT TO SUBSECTION (B) OF THIS
 SECTION MAY APPLY TO THE SUPERINTENDENT FOR RELIEF AND REIMBURSEMENT  BY
 THE  DEPARTMENT FROM FUNDS COLLECTED AND MADE AVAILABLE FOR THIS PURPOSE
 AS PROVIDED IN SUBSECTION (D) OF THIS SECTION.
   (2) THE SUPERINTENDENT SHALL ESTABLISH PROCEDURES FOR  THE  SUBMISSION
 AND   QUALIFICATION  OF  CLAIMS  BY  INSURERS  WHICH  ARE  ELIGIBLE  FOR
 REIMBURSEMENT PURSUANT TO THIS SECTION. THE SUPERINTENDENT SHALL  INCOR-
 PORATE  IN  THESE  PROCEDURES SUCH STANDARDS AS ARE NECESSARY TO PROTECT
 AGAINST THE SUBMISSION OF FRAUDULENT CLAIMS BY INSUREDS, AND APPROPRIATE
 SAFEGUARDS FOR INSURERS TO EMPLOY IN THE  REVIEW  AND  PAYMENT  OF  SUCH
 CLAIMS.
   (D)(1)  THE  SUPERINTENDENT  IS  AUTHORIZED TO IMPOSE UPON, DISTRIBUTE
 AMONG, AND COLLECT FROM THE COMPANIES, INCLUDING EXCESS LINES  INSURERS,
 ENGAGED IN BUSINESS PURSUANT TO THIS CHAPTER, SUCH ADDITIONAL AMOUNTS AS
 MAY  BE  NECESSARY  TO  RECOVER THE AMOUNTS PAID TO INSURERS PURSUANT TO
 SUBSECTION (C) OF THIS SECTION.
   (2) THE ADDITIONAL SPECIAL PURPOSE APPORTIONMENT  AUTHORIZED  PURSUANT
 TO  PARAGRAPH ONE OF THIS SUBSECTION SHALL BE DISTRIBUTED IN THE PROPOR-
 TION THAT THE NET WRITTEN PREMIUMS, OR PREMIUM  TAXES  IN  THE  CASE  OF
 EXCESS  LINES  INSURERS,  RECEIVED BY EACH COMPANY SUBJECT TO THE APPOR-
 TIONMENT AUTHORIZED BY THIS SECTION FOR INSURANCE WRITTEN OR RENEWED  ON
 RISKS  IN  THIS  STATE  DURING  THE CALENDAR YEAR IMMEDIATELY PRECEDING,
 BEARS TO THE SUM TOTAL OF ALL SUCH  NET  WRITTEN  PREMIUMS,  OR  PREMIUM
 TAXES  IN  THE  CASE OF EXCESS LINES INSURERS, RECEIVED BY ALL COMPANIES
 WRITING THAT INSURANCE OR COVERAGE WITHIN THE STATE DURING THAT CALENDAR
 YEAR, AS REPORTED.
   § 2. This act shall take effect immediately and  shall  apply  to  all
 business interruption insurance claims filed by an insured and all poli-
 cies  or  contracts issued, renewed, modified, altered or amended on and
 after such effective date.

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Senate Bill S18

Sponsored By

Current Bill Status - In Senate Committee Insurance Committee

co-Sponsors

2023-S18 (ACTIVE) - Details

2023-S18 (ACTIVE) - Summary

2023-S18 (ACTIVE) - Sponsor Memo

2023-S18 (ACTIVE) - Bill Text download pdf

Comments

Senate Bill S18

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Sponsored By

Andrew Gounardes

Current Bill Status - In Senate Committee Insurance Committee

co-Sponsors

Zellnor Myrie

2023-S18 (ACTIVE) - Details

2023-S18 (ACTIVE) - Summary

2023-S18 (ACTIVE) - Sponsor Memo

2023-S18 (ACTIVE) - Bill Text download pdf

Comments