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S00018 Summary:

BILL NOS00018
 
SAME ASSAME AS A00418
 
SPONSORGOUNARDES
 
COSPNSRMYRIE
 
MLTSPNSR
 
Add §346, Ins L
 
Relates to requiring business interruption insurance to cover disease outbreaks as denying such coverage based on a disease outbreak is against public policy.
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S00018 Actions:

BILL NOS00018
 
01/04/2023REFERRED TO INSURANCE
01/03/2024REFERRED TO INSURANCE
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S00018 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                           18
 
                               2023-2024 Regular Sessions
 
                    IN SENATE
 
                                       (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:
 
     1    Section 1.  The insurance law is amended by adding a new  section  346
     2  to read as follows:
     3    §  346. Business interruption insurance; disease outbreak. (a) For the
     4  purposes of this section:
     5    (1) "business" shall mean a business registered with the department of
     6  tax and finance or not-for-profit corporation registered with the attor-
     7  ney general's charities bureau.
     8    (2) "eligible employee" shall mean a full-time employee  who  works  a
     9  normal work week of twenty-five or more hours.
    10    (3)  "income"  shall  mean traditional business income as well as not-
    11  for-profit revenue from donations, sponsorships, and grants.
    12    (4) "net written premiums received" shall mean gross  direct  premiums
    13  written,  less return premiums thereon and dividends credited or paid to
    14  policyholders, as reported on the company's annual financial statement.
    15    (5) "premium taxes" shall mean payments required under subsection  (d)
    16  of section two thousand one hundred eighteen of this chapter.
    17    (b)  (1)  Notwithstanding any provisions of law, rule or regulation to
    18  the contrary, every clause or provision of a policy of insurance  insur-
    19  ing  against  loss  or  damage  to  property, which includes, but is not
    20  limited to, the loss of use and occupancy and business interruption  and
    21  contingent  business  interruption,  which  allows  the  insurer to deny
    22  coverage based on a virus, bacterium, or other microorganism that causes
    23  disease, illness, or physical distress or that  is  capable  of  causing
    24  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
 
     1  public  policy;  provided, however, the remaining clauses and provisions
     2  of the contract shall remain in effect for the duration of the  contract
     3  term.
     4    (2)  The  coverage  required  by  this  subsection shall indemnify the
     5  insured, subject to the limits under the policy, for any loss  of  busi-
     6  ness or business interruption and contingent business interruption.
     7    (3)  This  subsection  shall apply to policies issued to insureds with
     8  less than two hundred fifty eligible employees.
     9    (c)(1) An insurer, including excess lines insurers, which  indemnifies
    10  an  insured  who  has  filed  a claim pursuant to subsection (b) of this
    11  section may apply to the superintendent for relief and reimbursement  by
    12  the  department from funds collected and made available for this purpose
    13  as provided in subsection (d) of this section.
    14    (2) The superintendent shall establish procedures for  the  submission
    15  and   qualification  of  claims  by  insurers  which  are  eligible  for
    16  reimbursement pursuant to this section. The superintendent shall  incor-
    17  porate  in  these  procedures such standards as are necessary to protect
    18  against the submission of fraudulent claims by insureds, and appropriate
    19  safeguards for insurers to employ in the  review  and  payment  of  such
    20  claims.
    21    (d)(1)  The  superintendent  is  authorized to impose upon, distribute
    22  among, and collect from the companies, including excess lines  insurers,
    23  engaged in business pursuant to this chapter, such additional amounts as
    24  may  be  necessary  to  recover the amounts paid to insurers pursuant to
    25  subsection (c) of this section.
    26    (2) The additional special purpose apportionment  authorized  pursuant
    27  to  paragraph one of this subsection shall be distributed in the propor-
    28  tion that the net written premiums, or premium  taxes  in  the  case  of
    29  excess  lines  insurers,  received by each company subject to the appor-
    30  tionment authorized by this section for insurance written or renewed  on
    31  risks  in  this  state  during  the calendar year immediately preceding,
    32  bears to the sum total of all such  net  written  premiums,  or  premium
    33  taxes  in  the  case of excess lines insurers, received by all companies
    34  writing that insurance or coverage within the state during that calendar
    35  year, as reported.
    36    § 2. This act shall take effect immediately and  shall  apply  to  all
    37  business interruption insurance claims filed by an insured and all poli-
    38  cies  or  contracts issued, renewed, modified, altered or amended on and
    39  after such effective date.
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