Contractors Insurance No Comments

Last time, we talked about the Professional Insurance Agents of New York State Inc.’s (PIANY) activism in the upcoming 2014 legislative session. They’ve recently announced their agenda for bill lobbying, which includes a bill regarding regulation of certificates of insurance issuance, reforms to New York Labor Law 240, 241, and 241-a, auto insurance, property insurance, and workers’ compensation.

Property Insurance

New York is sadly well-acquainted with the horrors of natural disaster, and has become acutely aware of the important of insurance policies that protect homeowners in cases of hurricanes and floods. There is no standardization of hurricane deductible triggers, presently, which is hugely problematic for homeowners, especially those on the coast.

Hurricane deductible triggers vary tremendously from carrier to carrier. The result of this drastic variation is that two homeowners with the same amount of damage in the wake of a storm may have incredibly different degrees of coverage—one of them may have no coverage at all!

PIANY believes that hurricane deductible triggers need to be standardized at a certain point, after which the insurance provider’s deductible would go into effect. The providers will still be able to set their deductible rates however they see fit, which would allow them the flexibility they want. Every year, the Assembly passes this bill, but this year PIANY is putting pressure on the Senate to pass it as well.

Workers’ Compensation

The New York State Insurance Fund (NYSIF) provides workers’ compensation to many businesses. Those businesses are connected with the NYSIF through various insurance brokers, none of whom receive a commission for the services they provide.

This is not the first time that PIANY has taken issue with the unfair arrangement that exists between insurance brokers and the NYSIF. However, in the past discussions of including rates to compensate the brokers, the NYSIF has been resistant.

The fact that NYSIF relies on broker services from licensed insurance producers who are never compensated becomes an issue of equity, and PIANY’s resolution is to amend NYSIF’s statutory rating provisions to provide broker compensation.

NYSIF is also exempt from licensing and other insurance requirements, which puts New York’s commercial insurance market at a serious disadvantage. PIANY feels that instead of NYSIF being able to acquire and retain business through active marketing campaigns that directly compete with independent insurance providers, they should only be considered a “last-resort” provider. Their exemption from the same guidelines as the providers in the private sector gives NYSIF way too great of an advantage for them to be competing with the rest of the providers directly.

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