Bill Text: NY S08885 | 2019-2020 | General Assembly | Introduced


Bill Title: Requires health and motor vehicle insurance policies to notify policyholders of cancellation, discontinuance or major changes to their policy via email and to offer paperless notification upon the issuance of such policies.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2020-08-07 - REFERRED TO RULES [S08885 Detail]

Download: New_York-2019-S08885-Introduced.html



                STATE OF NEW YORK
        ________________________________________________________________________

                                          8885

                    IN SENATE

                                     August 7, 2020
                                       ___________

        Introduced  by  Sen.  COMRIE -- read twice and ordered printed, and when
          printed to be committed to the Committee on Rules

        AN ACT to amend the insurance law, in relation to requiring  health  and
          motor  vehicle insurance policies to notify policyholders of cancella-
          tion, discontinuance or major changes to their policy via email and to
          offer paperless notification upon the issuance of such policies

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section 1. The opening paragraph of subparagraph (H) of paragraph 2 of
     2  subsection (d) of section 3216 of the insurance law, as amended by chap-
     3  ter 344 of the laws of 1994, is amended to read as follows:
     4    CANCELLATION:  Within  the  first ninety days after the date of issue,
     5  the insurer may cancel this policy by written notice  delivered  to  the
     6  insured, or sent by first class mail to his or her last address as shown
     7  by  the records of the insurer, and shall also give such notice by email
     8  if the insurer has the insured's email address on file stating when, not
     9  less than ten days thereafter, such cancellation shall be effective.  In
    10  the event of cancellation, the insurer will return promptly the pro-rata
    11  unearned  portion  of  any  premium  paid. Cancellation shall be without
    12  prejudice to any claim  originating  prior  to  the  effective  date  of
    13  cancellation.
    14    § 2. Subsection (c) of section 3216 of the insurance law is amended by
    15  adding a new paragraph 15 to read as follows:
    16    (15)  That  the insurer offers the person applying for such policy the
    17  option to receive all notifications required by this  section  electron-
    18  ically.
    19    § 3. Subparagraph (A) of paragraph 1 of subsection (d) of section 3216
    20  of  the  insurance law, as amended by chapter 13 of the laws of 2002, is
    21  amended to read as follows:
    22    (A) ENTIRE CONTRACT; CHANGES: This policy, including the  endorsements
    23  and  the  attached  papers,  if  any, constitutes the entire contract of
    24  insurance. No change in this policy shall be valid until approved by  an
    25  executive  officer  of  the insurer and unless such approval be endorsed
    26  hereon or attached hereto. No agent or broker has  authority  to  change

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD09593-02-9

        S. 8885                             2

     1  this policy or to waive any of its provisions.  The insurer shall notify
     2  the  insured  of  any  major change made to this policy via email if the
     3  insurer has the insured's email address on file.
     4    § 4. Subparagraph (B) of paragraph 3 of subsection (g) of section 3216
     5  of  the  insurance  law, as added by chapter 661 of the laws of 1997, is
     6  amended to read as follows:
     7    (B) the insurer provides written notice of  such  discontinuance,  and
     8  notice via email if the insurer has the insured's email address on file,
     9  to each covered individual at least one hundred eighty days prior to the
    10  date of termination of such coverage;
    11    § 5. Subparagraph (B) of paragraph 2 of subsection (g) of section 3216
    12  of  the  insurance  law, as added by chapter 661 of the laws of 1997, is
    13  amended to read as follows:
    14    (B) the insurer provides written notice of  such  discontinuance,  and
    15  notice via email if the insurer has the insured's email address on file,
    16  to  each  covered  individual  at least ninety days prior to the date of
    17  discontinuance of such coverage;
    18    § 6. Paragraph 2 of subsection (a) of section 3221  of  the  insurance
    19  law is amended to read as follows:
    20    (2)  That  no agent has authority to change the policy or waive any of
    21  its provisions and that no change in the policy shall  be  valid  unless
    22  approved  by  an  officer of the insurer and evidenced by endorsement on
    23  the policy, or by amendment to the policy signed by the policyholder and
    24  the insurer.  The insurer shall notify the insured  of  any  significant
    25  change  made  to  the  policy via email if the insurer has the insured's
    26  email address on file.
    27    § 7. The opening paragraph of item (i) of subparagraph  (A)  of  para-
    28  graph  3  of  subsection  (p)  of  section 3221 of the insurance law, as
    29  amended by chapter 398 of the laws  of  2010,  is  amended  to  read  as
    30  follows:
    31    the  insurer  provides  written  notice  to each policyholder provided
    32  coverage of this class in such market (and to all employees  and  member
    33  insureds  covered  under  such coverage) of such discontinuance at least
    34  ninety days prior to  the  date  of  discontinuance  of  such  coverage,
    35  provided,  however, the insurer shall also provide such notice via email
    36  if the insurer has the email addresses of the policyholders on file.  In
    37  addition to any other information required of notices by the superinten-
    38  dent, this written notice shall conspicuously include an explanation, in
    39  plain language, of the policyholder's and covered employee's  or  member
    40  insured's  rights  under  this  subparagraph  and (B) of this paragraph,
    41  including:
    42    § 8. Item (i) of subparagraph (E) of paragraph 3 of subsection (p)  of
    43  section 3221 of the insurance law, as amended by chapter 398 of the laws
    44  of 2010, is amended to read as follows:
    45    (i)  the  insurer provides written notice to the superintendent and to
    46  each policyholder (and all employees and member insureds  covered  under
    47  such  coverage)  of such discontinuance at least one hundred eighty days
    48  prior to the date of the  discontinuance  of  such  coverage,  provided,
    49  however,  the  insurer  shall  also provide such notice via email if the
    50  insurer has the email addresses of the policyholders on file;
    51    § 9. Subsection (a) of section 3221 of the insurance law is amended by
    52  adding a new paragraph 17 to read as follows:
    53    (17) That the insurer offers the person applying for such  policy  the
    54  option  to  receive all notifications required by this section electron-
    55  ically.

        S. 8885                             3

     1    § 10. Paragraph 1 of subsection (h) of section 3425 of  the  insurance
     2  law, as amended by chapter 675 of the laws of 2003, is amended and a new
     3  paragraph 4 is added to read as follows:
     4    (1) Proof of mailing of a notice of cancellation, reduction of limits,
     5  substitution  of  policy  form,  elimination  of  coverages, conditioned
     6  renewal or of intention not to renew, or proof of  the  mailing  of  the
     7  reasons therefor, to the named insured at the address shown in the poli-
     8  cy,  shall be sufficient proof of the giving of notice and the giving of
     9  reasons required by this section.   Provided, however, with  respect  to
    10  automobile  insurance  if the insurer has the insured's email address on
    11  file the insurer shall send  a  notice  of  cancellation,  reduction  of
    12  limits,  substitution  of  policy form, elimination of coverages, condi-
    13  tional renewal or of intention not to renew, or notice  of  the  reasons
    14  therefor to the insured via email.
    15    (4)  The  insurer  of  any  automobile insurance shall, when issuing a
    16  covered policy, offer the insured the option of  opting  into  paperless
    17  communication  to  receive  all notification regarding any cancellation,
    18  reduction of limits, substitution of policy form, elimination of  cover-
    19  ages, conditioned renewal or of intention not to renew, or notice of the
    20  reasons therefor.
    21    §  11.  Items  (i)  and  (ii)  of  subparagraph  (C) of paragraph 2 of
    22  subsection (c) of section 4304 of the insurance law, item (i) as amended
    23  by chapter 317 of the laws of 2017 and item (ii) as amended  by  chapter
    24  661 of the laws of 1997, are amended to read as follows:
    25    (i)  Discontinuance  of  a class of contract upon not less than ninety
    26  days' prior written notice, and notice via email if the corporation  has
    27  the  enrolled  individual's  email  address on file.   In exercising the
    28  option to discontinue coverage pursuant to this  item,  the  corporation
    29  must act uniformly without regard to any health status-related factor of
    30  enrolled  individuals  or  individuals  who may become eligible for such
    31  coverage and must offer to subscribers or group remitting agents, as may
    32  be appropriate, the option  to  purchase  all  other  individual  health
    33  insurance  coverage currently being offered by the corporation to appli-
    34  cants in that market. Provided, however, the superintendent  may,  after
    35  giving  due consideration to the public interest, approve a request made
    36  by a corporation for the corporation to satisfy the requirements of this
    37  item through the offering of contracts at  each  level  of  coverage  as
    38  defined  in  section  1302(d)  of  the  affordable care act, 42 U.S.C. §
    39  18022(d) that contains  the  benefits  described  in  paragraph  one  of
    40  subsection  (b)  of  section four thousand three hundred twenty-eight of
    41  this [chapter] article by another corporation, insurer or health mainte-
    42  nance organization within the corporation's same holding company system,
    43  as defined in article fifteen of this chapter.
    44    (ii) Discontinuance of  all  hospital,  surgical  or  medical  expense
    45  coverage  in  the  individual  direct  payment market in this state upon
    46  written notice to the superintendent and to  each  subscriber  not  less
    47  than one hundred eighty days prior to the date of the expiration of such
    48  coverage,  and  notice via email if the corporation has the subscriber's
    49  email address on file.  In the event of such a withdrawal from the indi-
    50  vidual direct payment market, the  corporation  must  also  provide  the
    51  superintendent  with  a written plan to minimize potential disruption in
    52  the marketplace occasioned by such withdrawal. In addition,  the  corpo-
    53  ration  may  not  provide  for the issuance of any hospital, surgical or
    54  medical expense coverage in the individual direct payment market in this
    55  state during the five-year period beginning on the date of  the  discon-
    56  tinuance of the last health insurance coverage not so renewed.

        S. 8885                             4

     1    §  12.  The opening paragraph of item (i) of subparagraph (A) and item
     2  (i) of subparagraph (E) of paragraph 3 of subsection (j) of section 4305
     3  of the insurance law, as amended by chapter 398 of the laws of 2010, are
     4  amended to read as follows:
     5    the  corporation  provides written notice to each contract holder, and
     6  notice via email if the corporation  has  the  contract  holder's  email
     7  address  on file, provided coverage of this class in such market (and to
     8  all employees and member insureds covered under such coverage)  of  such
     9  discontinuance  at least ninety days prior to the date of discontinuance
    10  of such coverage.   In addition to any  other  information  required  of
    11  notices  by  the superintendent, this written notice shall conspicuously
    12  include an explanation, in plain language, of the contract holder's  and
    13  covered  employee's  or  member insured's rights under this subparagraph
    14  and subparagraph (B) of this paragraph, including:
    15    (i) the corporation provides written notice to the superintendent  and
    16  to  each  contract holder (and all employees and member insureds covered
    17  under such coverage), and notice via email if the  corporation  has  the
    18  contract holder's email address on file, of such discontinuance at least
    19  one  hundred eighty days prior to the date of the discontinuance of such
    20  coverage;
    21    § 13. This act shall take effect immediately and shall  apply  to  all
    22  policies  or  contracts issued, renewed, modified, altered or amended on
    23  and after such effective date.
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