Add Art 33 §§1300 - 1301, Art 34 §§1310 - 1319, Priv Hous Fin L
Limits the liability of low-income housing providers who receive government assistance; establishes a temporary insurance stabilization program for such entities.
STATE OF NEW YORK
________________________________________________________________________
11059
IN ASSEMBLY
April 24, 2026
___________
Introduced by M. of A. DILAN -- read once and referred to the Committee
on Housing
AN ACT to amend the private housing finance law, in relation to limiting
the liability of low-income housing providers who receive government
assistance, and establishing a temporary insurance stabilization
program for such entities; and providing for the repeal of certain
provisions upon the expiration thereof
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The private housing finance law is amended by adding a new
2 article 33 to read as follows:
3 ARTICLE XXXIII
4 LOW-INCOME HOUSING LIABILITY STANDARDS
5 Section 1300. Definitions.
6 1301. Limitation of liability for low-income housing providers.
7 § 1300. Definitions. As used in this article, the following terms
8 shall have the following meanings:
9 1. "Covered low-income housing provider" means an entity that:
10 (a) is a nonprofit organization that:
11 (i) qualifies as an appropriate nonprofit organization as defined in
12 section twelve hundred eighty-one of this chapter; and
13 (ii) holds an ownership stake in the housing property it manages of at
14 least forty-five percent;
15 (b) is an entity that meets the definition of housing company as
16 defined in subdivision three of section three of the public housing law;
17 or
18 (c) is an entity that:
19 (i) provides low rent housing as such term is defined in subdivision
20 twenty-three of section three of the public housing law; and
21 (ii) receives some combination of federal, state, or municipal funding
22 to effectuate the provision of such low rent housing, such that the
23 housing qualifies as a project as defined in subdivision fourteen of
24 section three of the public housing law.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD15392-01-6
A. 11059 2
1 2. "Non-medical damages" means any compensatory damages, including a
2 non-economic loss as such term is defined in section sixteen hundred of
3 the civil practice law and rules, sought by a plaintiff and resulting
4 from the willful, wanton or grossly negligent conduct of the defendant,
5 but shall not include medical expense damages described in paragraph (d)
6 of subdivision three of this section.
7 3. "Qualified civil liability action" means a civil action or proceed-
8 ing brought by any person against a covered low-income housing provider,
9 but shall not include an action where:
10 (a) the defendant's conduct giving rise to such action was willful,
11 wanton, or grossly negligent;
12 (b) punitive damages are not sought by the plaintiff, nor awarded by
13 the court;
14 (c) non-medical damages sought do not exceed five hundred thousand
15 dollars; and
16 (d) medical expense damages sought do not exceed the reimbursement
17 rates in effect for such care under the schedule set forth by the chair
18 of the workers' compensation board pursuant to section thirteen of the
19 workers' compensation law.
20 § 1301. Limitation of liability for low-income housing providers.
21 Notwithstanding any other provision of law to the contrary, no qualified
22 civil liability action may be brought in any court in the state.
23 § 2. The private housing finance law is amended by adding a new arti-
24 cle 34 to read as follows:
25 ARTICLE XXXIV
26 TEMPORARY INSURANCE STABILIZATION PROGRAM
27 Section 1310. Legislative findings and purpose.
28 1311. Definitions.
29 1312. Joint underwriting association.
30 1313. Plan of operation and procedures.
31 1314. Rating plans.
32 1315. Participation and assessments.
33 1316. Annual aggregate loss limitation.
34 1317. Annual statements.
35 1318. Examinations.
36 1319. Study and determination.
37 § 1310. Legislative findings and purpose. It is hereby declared and
38 found that the availability of affordable housing in this state remains
39 an important priority in the public interest. It is further found that
40 there exists in the state a diminishing and seriously inadequate supply
41 of safe and sanitary dwelling accommodations, particularly for persons
42 of low-income; that existing providers of low-income housing must shoul-
43 der unlimited liability despite being limited in the rents they must
44 charge; that such providers of low-income housing must also bear rising
45 liability insurance costs due to numerous factors beyond their control;
46 that the rising costs of such insurance may lead to such providers exit-
47 ing the affordable housing business altogether, further exacerbating the
48 affordable housing crisis; and that the unlimited liability borne by
49 such providers runs directly counter to the goals of the numerous feder-
50 al, state, and municipal grant programs intended to address the afforda-
51 ble housing crisis.
52 In order to promote the purpose of existing housing grant programs and
53 provide for adequate protection of federal, state, and local investments
54 in affordable housing development, the creation of a temporary program
55 to ensure the availability of liability insurance for such providers is
56 necessary.
A. 11059 3
1 The necessity in the public interest for the provisions hereinafter
2 enacted is hereby declared as a matter of legislative determination.
3 § 1311. Definitions. As used in this article, the following terms
4 shall have the following meanings:
5 1. "Association" means the joint underwriting association established
6 under this article.
7 2. "Covered low-income housing provider" means an entity that:
8 (a) is a nonprofit organization that:
9 (i) qualifies as an appropriate nonprofit organization as defined in
10 section twelve hundred eighty-one of this chapter; and
11 (ii) holds an ownership stake in the housing property it manages of at
12 least forty-five percent;
13 (b) is an entity that meets the definition of housing company as
14 defined in subdivision three of section three of the public housing law;
15 or
16 (c) is an entity that:
17 (i) provides low rent housing as such term is defined in subdivision
18 twenty-three of section three of the public housing law; and
19 (ii) receives some combination of federal, state, or municipal funding
20 to effectuate the provision of such low rent housing, such that the
21 housing qualifies as a project as defined in subdivision fourteen of
22 section three of the public housing law.
23 3. "Net direct premiums" means gross direct premiums written in this
24 state for commercial general liability insurance, as computed by the
25 superintendent, less return premiums or the unused or unabsorbed
26 portions of premium deposits.
27 4. "Plan of operation" or "plan" means the plan of operation complying
28 with section thirteen hundred thirteen of this article.
29 5. "Superintendent" means the superintendent of the department of
30 financial services.
31 § 1312. Joint underwriting association. 1. A joint underwriting asso-
32 ciation known as the New York housing insurance stabilization associ-
33 ation is hereby established, consisting of all insurers, including
34 captive insurers, authorized to write and engaged in writing within this
35 state, on a direct basis, commercial general liability insurance. Every
36 such insurer shall be and remain a member of the association as a condi-
37 tion of its authority to continue to transact commercial general liabil-
38 ity insurance in the state.
39 2. The association shall be governed by a board of thirteen directors,
40 ten of whom shall be elected annually by cumulative voting by the
41 members of the association, whose votes in such election shall be
42 weighted in accordance with each member's net direct premiums written
43 during the preceding calendar year. The remaining three directors shall
44 be appointed annually by the superintendent and be duly licensed insur-
45 ance agents or brokers representative of broad segments of the public
46 obtaining insurance through the association.
47 3. The association shall, pursuant to the provisions of this article
48 and the plan of operation, make commercial general liability insurance
49 available through the association, and shall have the power on behalf of
50 its members:
51 (a) to cause policies of insurance to be issued to eligible appli-
52 cants;
53 (b) to assume reinsurance from its members, including members that are
54 captive insurers; and
55 (c) to cede reinsurance.
A. 11059 4
1 § 1313. Plan of operation and procedures. 1. The association shall
2 adhere to a plan of operation, consistent with the provisions of this
3 article, approved by the superintendent after consultation with affected
4 individuals and organizations. The plan shall provide for economical,
5 fair and non-discriminatory administration and prompt and efficient
6 provision of commercial general liability insurance to eligible appli-
7 cants. Such plan shall contain other matters including, but not limited
8 to, provision for necessary facilities, management of the association,
9 assessment of members to defray losses and expenses, commission arrange-
10 ments, reasonable and objective underwriting standards, acceptance and
11 cession of reinsurance, and procedures for determining amounts of insur-
12 ance to be provided by the association.
13 2. The plan of operation shall:
14 (a) authorize the association to issue commercial general liability
15 insurance to covered low-income housing providers;
16 (b) provide for the provision of different per-occurrence limits and
17 aggregate limits in coverage;
18 (c) provide for the use of premium installment plans;
19 (d) prohibit the association from issuing polices other than commer-
20 cial general liability insurance policies; and
21 (e) provide procedures by which the association may assume reinsurance
22 from its members and cede reinsurance to the private reinsurance market.
23 3. The directors of the association may, on their own initiative or at
24 the request of the superintendent, amend the plan subject to approval by
25 the superintendent.
26 4. The association shall, subject to the plan of operation, offer
27 commercial general liability insurance to covered low-income housing
28 providers at rates determined in pursuant to section thirteen hundred
29 fourteen of this article for a period of five years following the effec-
30 tive date of this article.
31 5. Any covered low-income housing provider, who has made a diligent
32 effort in the normal insurance market to procure commercial general
33 liability insurance, is entitled to apply to the association for such
34 coverage. Such application may be made on behalf of an applicant by a
35 broker or agent authorized by such applicant.
36 6. If the association determines that (a) the applicant is insurable
37 in accordance with the plan, and (b) there is no unpaid, uncontested
38 premium due from the applicant for prior insurance, as shown by the
39 insured having failed to make written objection to charges within thirty
40 days after billing, the association, upon receipt of the premium or
41 portion prescribed in the plan, shall cause a policy of commercial
42 general liability insurance to be issued for a term of one year.
43 7. Any member, including captive insurers, may cede commercial general
44 liability insurance to the association as provided in the plan.
45 8. Any applicant to the association and any person insured pursuant to
46 this article, or their representatives, or any affected insurer, may
47 appeal to the superintendent within thirty days after any ruling, action
48 or decision by or on behalf of the association, with respect to those
49 items the plan of operation defines as appealable matters.
50 § 1314. Rating plans. 1. The rates, rating plans, rating rules and
51 statistics applicable to insurance written by the association shall be
52 subject to the relevant provisions of article twenty-three of the insur-
53 ance law, except as otherwise provided in this section.
54 2. Annually, on a date set by the superintendent, the association
55 shall estimate the actuarial rates sufficient to pay all valid claims
56 and meet the expenses incurred by the association in writing and servic-
A. 11059 5
1 ing policies, and shall file such rates, on a form prescribed by the
2 superintendent, with the department of financial services.
3 3. Not later than sixty days after the rating plan described in subdi-
4 vision two of this section is received, the superintendent, in consulta-
5 tion with the commissioner, shall determine whether such rates are
6 reasonable and affordable for covered low-income housing providers in
7 light of the necessity of affordable housing and the importance of
8 providing adequate protection for government housing investments.
9 4. If the superintendent and commissioner determine that the actuari-
10 al-based rates described in subdivision two of this section are not
11 affordable, the superintendent shall determine an appropriate subsidy to
12 apply to such rates, and the association shall charge its policyholders
13 the subsidized rates as approved by the superintendent.
14 § 1315. Participation and assessments. 1. Every member of the associ-
15 ation shall participate in its writings, expenses, profits and losses in
16 the proportion that the net direct premiums of the member, but excluding
17 that portion of premiums attributable to the operation of the associ-
18 ation, written during the preceding calendar year bear to the aggregate
19 net direct premiums written in this state by all members of the associ-
20 ation. Each member's participation in the association shall be deter-
21 mined annually on the basis of such net direct premiums written during
22 the preceding calendar year as disclosed in the annual statements and
23 other reports filed by the member with the superintendent.
24 2. No member shall be obligated in any year to reimburse the associ-
25 ation on account of its proportionate share in the deficit from oper-
26 ations of the association in that year in excess of one percent of its
27 surplus to policyholders. The aggregate amount not so reimbursed shall
28 be reallocated among the remaining members in accordance with the method
29 of determining participation prescribed in this section, after excluding
30 from the computation the total net direct premiums of all members not
31 sharing in such excess deficit. In the event that the deficit from oper-
32 ations allocated to all members in any calendar year shall exceed one
33 percent of their respective surplus to policyholders, the amount of such
34 deficit shall be allocated to each member in accordance with the method
35 of determining participation prescribed in this section.
36 3. Annually, on a date set by the superintendent, the association
37 shall estimate its deficit from operations, and calculate a factor, not
38 to exceed one percent, by relating such deficit to net direct premiums
39 written for the latest calendar year, subject to the approval of the
40 superintendent. Such factor may be reflected in the determination of
41 rates filed by the principal rating organization in this state and by
42 members of the association for commercial general liability insurance.
43 Any part of such deficit which exceeds one percent as so calculated,
44 shall be defrayed by an increase in rates, based upon the association's
45 related loss and expense experience together with other information the
46 superintendent requires, in accordance with filings approved by the
47 superintendent. Each member's share of the estimated deficit shall be
48 collected by the association in accordance with the plan of operation.
49 4. Subject to approval by the superintendent, the association shall
50 develop and implement an incentive plan for members which voluntarily
51 write commercial general liability insurance policies for covered low-
52 income housing providers. The purpose of these incentives shall be to
53 encourage the writing of voluntary insurance policies and thereby reduc-
54 ing the exposure of the association.
55 § 1316. Annual aggregate loss limitation. 1. Notwithstanding any other
56 provision of federal or state law, the aggregate losses paid by the
A. 11059 6
1 association during a calendar year shall not exceed fifty million
2 dollars.
3 2. Neither the association, nor any member of the association that has
4 met its assessment obligations, shall be liable for the payment of any
5 portion of the amount of losses that exceeds fifty million dollars.
6 3. Any losses in excess of fifty million dollars for which the associ-
7 ation would otherwise be liable but for the limitation in this section,
8 shall be paid by the New York state division of housing and community
9 renewal, under procedures to be prescribed by the commissioner.
10 § 1317. Annual statements. 1. The association shall annually file a
11 statement in the office of the superintendent on or before the first day
12 of March. Such statement shall be in a form approved by and contain
13 information required by the superintendent with respect to its trans-
14 actions, condition, operations and affairs during the preceding year.
15 2. The superintendent may at any time require the association to
16 furnish additional information which such superintendent considers to be
17 material in evaluating the scope, operation and experience of the asso-
18 ciation.
19 § 1318. Examinations. The superintendent may, in accordance with arti-
20 cle three of the insurance law, make an examination into the affairs of
21 the association whenever the superintendent deems it expedient. The
22 expenses of every such examination shall be borne and paid by the asso-
23 ciation in the manner prescribed by subsection (f) of section two
24 hundred six of the financial services law.
25 § 1319. Study and determination. No later than three years after the
26 effective date of this article, the superintendent shall, in consulta-
27 tion with the commissioner:
28 1. conduct a study on the availability and affordability of liability
29 insurance for low-income housing providers;
30 2. assess the potential impact on availability and affordability of
31 such insurance if the association established under this article were to
32 be disbanded; and
33 3. submit a report and recommendation to the governor regarding wheth-
34 er the association established under this article should continue to
35 operate.
36 § 3. This act shall take effect on the one hundred eightieth day after
37 it shall have become a law; provided, however, that the provisions of
38 section two of this act shall expire and be deemed repealed once the
39 joint underwriting association established pursuant to article 34 of the
40 private housing finance law as added by section two of this act has
41 completed servicing all policies issued and fulfilled all obligations
42 pursuant to such article; provided that the superintendent of financial
43 services shall notify the legislative bill drafting commission upon the
44 completion of servicing policies and fulfillment of obligations by the
45 joint underwriting association, in order that the commission may main-
46 tain an accurate and timely effective data base of the official text of
47 the laws of the state of New York in furtherance of effectuating the
48 provisions of section 44 of the legislative law and section 70-b of the
49 public officers law. Effective immediately, the addition, amendment
50 and/or repeal of any rule or regulation necessary for the implementation
51 of this act on its effective date are authorized to be made and
52 completed on or before such effective date.
