NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A1466
TITLE OF BILL:
An act to amend the insurance law, in relation to group
PURPOSE OR GENERAL IDEA OF BILL:
To facilitate the ability of New York residents to obtain employer-pro-
vided group property/casualty insurance coverage when their employers
are based in another state.
SUMMARY OF PROVISIONS:
Section one adds a new subsection (e) to Insurance Law section 3435
enabling residents of New York who are employed by employers based in
another state to obtain property/casualty or liability coverage under a
policy issued to their employer in 'that state, provided the policy is:
(1) issued by an insurer licensed in such other state, (2) approved by
that state's insurance regulator, and (3) the certificate of insurance
provided to the New York-based employee is issued without cost to the
employee. Further, any certificate of insurance issued to a New York
resident under these conditions must slate that insurance provided is
not subject to the consumer protections of the New York Insurance Law.
Section two is the effective date.
New York's existing law, by virtue of its operation and interpretation
by the New York State Insurance Department, works to prevent certain
group property/casualty coverage from being made available to New York
based employees of out-of-state companies, even where no cost to the
employee is involved.
While such an outcome is laudable in circumstances where New York resi-
dents could be paying premiums for products not licensed in New York, or
receiving coverage under policy forms not subject to review by the New
York Insurance Department, current law works in a counterproductive,
overly paternalistic manner when it serves to prevent New York residents
from obtaining an employee benefit made available free of charge to
employees in other states.
This bill was introduced after a situation where employees of a Pennsyl-
vania-based company were offered several benefits by their employer due
to the possible harm they could suffer from an identity theft incident.
These benefits included daily credit report monitoring, automatic alerts
for key changes to credit reports, unlimited access to credit report and
credit score information and $25,000 in identity theft coverage (with no
deductible) provided by a licensed insurer. These benefits were provided
to company employees nationwide, however, the New York employees of this
company were informed the insurance coverage would not be available to
them because identity theft insurance coverage could not be offered to
New York residents.
No public policy is served under circumstances such as these. The worst-
case scenario would be that the coverage is worthless, but since no
premium was exchanged and the insured knew New York's laws would not
extend consumer protections there is essentially no public purpose in
preventing residents from being offered coverage for free.
PRIOR LEGISLATIVE HISTORY:
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
STATE OF NEW YORK
2023-2024 Regular Sessions
January 17, 2023
Introduced by M. of A. BLANKENBUSH, BRABENEC, DeSTEFANO, HAWLEY, McDO-
NOUGH, MILLER -- read once and referred to the Committee on Insurance
AN ACT to amend the insurance law, in relation to group
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 3435 of the insurance law is amended by adding a
2 new subsection (e) to read as follows:
3 (e) Neither the provisions of this section nor any other provisions of
4 this chapter shall serve to prevent the issuance of a certificate of
5 group property/casualty or liability insurance issued to a resident of
6 this state when such certificate is issued under a master policy
7 procured by an employer based in another state, provided (i) the policy
8 is an approved policy issued by an insurer licensed in such state, (ii)
9 the policy has been approved for sale in such state, and (iii) provided
10 the certificate is issued without cost to the New York resident. Any
11 such certificate issued to a New York resident shall state that the
12 insurance provided thereunder is not regulated by the state of New York
13 and not subject to consumer protections otherwise afforded by this chap-
15 § 2. This act shall take effect immediately.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
 is old law to be omitted.