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2023 Issues - The E&O Report

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November 2023: Supplemental Spousal Liability Coverage in New York Auto Policies

A new law became effective in New York on August 1, 2023, that requires auto insurers to provide supplemental spousal liability insurance coverage in their policies. Since the enactment of this law, we have received numerous questions from New York insurance agents and brokers about how this change in the law works and what they should be doing in connection with it. Accordingly, in this issue of The E&O Report we will review some of the elements of this new law and how a NY insurance agency or brokerage should deal with it going forward. [more]
One of the questions that we receive most frequently from New York insurance agencies and brokerages is what activities an unlicensed employee may perform. Many independent insurance agencies and brokerages rely upon unlicensed customer service representatives (CSRs) and other unlicensed employees to assist in their day-to-day operations. In this issue of The E&O Report we will review the rules that insurance agencies and brokerages should be aware of and follow in order to be in compliance with New York Law relating to this issue. [more]
Several years ago we wrote about insurance issues that should be considered when students are away at college. Following the publication of that E&O Report we received a great deal of feedback from agents and brokers on the various issues we raised. Since it is that time of year when students are headed off to college, we are once again revisiting this issue. [more]
As we have written in The E&O Report and discussed during recent seminars and webinars, regulatory investigations of insurance agents and brokers by the New York Department of Financial Services (“NYDFS”) have risen tremendously over the past several years. One of the most frequent areas of an investigation concerns the handling of premium funds. In this issue of the E&O Report, we discuss the New York laws and regulations applicable to how insurance agents and brokers should be handling premium money and the proper operation and maintenance of premium trust accounts. [more]
During the past few years, we have seen an increase in the number of non-party subpoenas that are being served on New York insurance agencies and brokerages. Very often, how a subpoena is handled can mean the difference between it developing into an E&O lawsuit, or not. Accordingly, in this issue of The E&O Report we will review some of the issues for agencies and brokerages to keep in mind regarding non-party subpoenas and also provide guidance as to how those subpoenas should be handled when they are received. [more]
We all know the phrase “The devil is in the details.” It is often attributed to the famed architect Ludwig Mies van der Rohe. The expression derives from an earlier German proverb “Der liebe Gott steckt im detail,' which translates as “God is in the detail.” Never has that phrase been more critical and, sadly, regularly ignored than in our new digital society. We agree to, and click on, any and everything as long as we get access to whatever service or website we desire. But we never read the fine print. We all should. Our professions demand it of us. [more]
In this issue of The E&O Report we will discuss some of the ways that AI is being used by insurance agencies and brokerages and the benefits, and also potential problems, that it presents. [more]
This year the Big I NY and Big I CT Annual Errors & Omissions Loss Control Seminars will once again be presented by me, Jim Keidel, along with my partner Chris Weldon, and also with Brian Bixby, of Big I NY and Big I CT. If you are interested in attending the upcoming seminars, you should contact the association and register as soon as possible, since space is limited and is filling up quickly. [more]
Nothing is more unnerving for the owners and/or management of an insurance agency or brokerage than receiving an inquiry from a state Insurance Department concerning a complaint made against it, or questions related to its business practices. We have been told by many insurance agencies and brokerages that their first impulse after receiving such an inquiry is to respond as quickly as possible to try to make the matter just go away. While it is always important to respond to any inquiry from any state Insurance Department, or any other regulatory authority, in a timely manner, an agency or brokerage facing this situation should always proceed with caution. Instead, our suggestion is that any agency or brokerage that receives such an inquiry follow several steps in the process of preparing its response. [more]
On November 21, 2022, the New York Department of Financial Services (“NYDFS”) issued Insurance Circular Letter No. 13 (2022) intended to provide guidance regarding cannabis-related criminal convictions and insurance underwriting. During the Thanksgiving weekend this Circular Letter was sent by the NYDFS by email to all licensed New York insurance agents and brokers. Following that communication from the NYDFS, we have received dozens of inquiries from New York insurance agents and brokers with questions concerning what, if anything, this Circular Letter means for them. Accordingly, in this issue of The E&O Report we will review the various issues addressed in the Circular Letter and provide some guidance regarding how New York insurance agents and brokers should handle this subject. [more]
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