(DeWitt, New York, Jan. 3, 2013) — The Independent Insurance Agents & Brokers of New York said today that the state’s forthcoming health insurance exchange; curbing abuse of insurance documents; and protecting coastal homeowners and renters will be its top priorities with lawmakers and regulators this year. New York’s oldest insurance producer trade organization will release its 2013 legislative position paper to state lawmakers early next week.
“These issues affect people and businesses throughout New York State, not just the insurance industry,” said IIABNY Chair of the Board Thomas J. Crowley. “They impact small businesses trying to buy health coverage for their employees. They influence families on Long Island trying to protect their homes. They cause problems for contractors who rebuild New York’s roads and buildings, businesses struggling with workers’ compensation costs, and anyone who registers a car in this state. We look forward to working with the new state legislature and with regulators to solve these problems.”
The creation of New York’s health insurance exchange is one of IIABNY’s top priorities. The federal health care reform law requires states to have these exchanges in operation by next fall. IIABNY has worked closely with state regulators for the last three years to create a marketplace that will meet the needs of all New Yorkers. The group believes that small businesses and consumers who shop for coverage in the exchange should be able to use the services of independent agents and brokers if they wish. IIABNY also believes that those agents and brokers who assist business owners and individuals buy coverage in the exchange should receive fair and reasonable compensation. The group continues to make the case for these features with the regulators who are creating the exchange.
Abuse of certificates of insurance consumes too many resources for insurance producers and the businesses they serve. These certificates are documents that provide information about an organization’s insurance coverage. Since 2011, IIABNY has worked closely with the Financial Services Department to address unreasonable certificate demands. IIABNY supports a bill that it had lawmakers introduce in the last two sessions. The bill would make knowingly asking a producer to issue inaccurate certificates a violation of state law. It would also require the state Financial Services Department to approve all certificate forms.
Of special concern is the delicate homeowners’ insurance market in the New York City metro area. Insurance companies are cautious about selling policies there because of the threat of hurricanes. The extensive damage caused by Superstorm Sandy and Tropical Storm Irene the last two years has increased their wariness. To keep the market stable and growing, IIABNY called on state lawmakers and regulators to:
- Require all homeowners policies sold in the area to have the same standard for triggering hurricane deductibles. These deductibles apply only to losses from hurricanes and can amount to thousands of dollars. Current rules permit different insurance companies to set different standards for when these deductibles will apply. A particular storm might make one company’s hurricane deductible apply. However, it might not trigger that of another company. IIABNY supports making the deductible trigger uniform. This will reduce policyholders’ confusion after a storm and avoid perceptions of unfair treatment.
- Avoid new constraints on insurance companies’ ability to drop customers. These changes may actually discourage companies from insuring these customers in the first place.
- Create a fund, along with the federal government, to cushion the effect of a major catastrophe. This fund would help prevent insurance companies hard-hit by an event from going out of business and leaving their customers with no source of benefits.
- Carry out all the market reforms enacted in 2008. These include industry panels to monitor the situation and programs to attract new companies to the market.
In addition to these top priorities, IIABNY is calling for:
- Changes to make the competition between private insurance companies and the New York State Insurance Fund in the Workers’ Compensation insurance market fairer.
- Changing a law requiring Workers’ Compensation insurance companies to deposit estimated future benefits with the New York State Insurance Fund. These are benefits for workers who have suffered permanent injuries that will prevent them from doing the same type of work in the future. Current law requires the companies to make extra payments to the Fund if they underestimate benefits. However, it does not allow them to recover their payments if they over-estimate benefits. IIABNY supports reform to encourage companies to participate in the New York market.
- Making it easier for brokers to get insurance for their clients from companies not licensed in New York State. This practice is legal; it is sometimes necessary when licensed companies will not insure a particular business. New York laws require brokers to complete forms each year verifying that they searched for licensed companies willing to provide the insurance. IIABNY supports relaxing that requirement so that the broker must do the search every third year. The group also favors permitting the broker to obtain coverage from an unlicensed company when a licensed company’s price is at least 25 percent more expensive.
- Allowing producers to deposit premium funds in out-of-state and online banks, and making it easier for them to keep the interest on those deposits.
- Replacing separate agent and broker licenses with a single producer license.
- Reform of the state’s no-fault automobile insurance law to reduce fraud that has driven up the cost of no-fault claims by an estimated 70 percent in the last decade.
- Reform of New York’s infamous “scaffolding law,” which courts have interpreted to strip contractors of legal defenses against injury claims involving a worker injured by a fall from any height. IIABNY supports a more reasonable standard for determining violations and permitting contractors to offer some defenses in court.
- Repeal of outdated requirements for insurance producer advertising.
IIABNY will conduct a free webinar for its members on January 11 to explain these issues in more detail. Registration instructions are available on the Web at
https://www1.gotomeeting.com/register/584546144. IIABNY will hold its annual Capital Day, at which agents and brokers gather for educational and networking events, to recognize exceptional achievements during 2011, and to meet with their representatives in the state legislature, in Albany on Jan. 29, 2013.
The Independent Insurance Agents & Brokers of New York, Inc. has represented the common business interests of independent insurance professionals since 1882. More than 1,750 agencies and their 13,000 plus employees currently rely on the DeWitt, New York-based not-for-profit trade association for legislative advocacy, continuing education and other means of industry support. In addition, most IIABNY members proudly identify themselves as Trusted Choice® agents and brokers, a national consumer brand uniting more than 21,000 independent agencies across the United States. For more information, go to www.trustedchoice.com or www.iiabny.org.