Bill Text: NY S09101 | 2021-2022 | General Assembly | Introduced

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Bill Title: Relates to contractual liability insurance policies; requires reimbursement to the provider for all obligations incurred by a provider under the terms of a service contract, or in the event of the provider's nonperformance, provide or pay on behalf of the provider all covered contractual obligations incurred by the provider.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2022-05-09 - REFERRED TO INSURANCE [S09101 Detail]

Download: New_York-2021-S09101-Introduced.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                          9101

                    IN SENATE

                                       May 9, 2022
                                       ___________

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

        AN ACT to amend the insurance law, in relation to contractual  liability
          insurance policies

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

     1    Section 1. Paragraph 1 of subsection (c) of section 7903 of the insur-
     2  ance law, as amended by chapter 578 of the laws of 2000, is  amended  to
     3  read as follows:
     4    (1)  [insure  the performance of all its obligations under all service
     5  contracts  pursuant  to  a]  purchase  one  or  more  service   contract
     6  reimbursement  insurance [policy] policies issued by [an insurer] one or
     7  more insurers authorized to issue service contract reimbursement  insur-
     8  ance  in  this  state or procured by an excess line licensee pursuant to
     9  section two thousand  one  hundred  eighteen  of  this  chapter.    Each
    10  reimbursement  insurance  policy  shall obligate the insurer that issued
    11  such policy to either provide reimbursement  to  the  provider  for  all
    12  obligations  incurred  by  a  provider  under  the  terms  of  a service
    13  contract, or in the event of the provider's nonperformance,  provide  or
    14  pay  on  behalf  of  the  provider  all  covered contractual obligations
    15  incurred by the provider. In the event the provider fails to insure  its
    16  obligations  pursuant to this paragraph or in the event that such insur-
    17  ance shall lapse or be terminated, the provider shall comply with either
    18  paragraph two or three of this subsection within forty-five days of  the
    19  insurance lapse or termination;
    20    §  2. Subsection (b) of section 7905 of the insurance law, as added by
    21  chapter 614 of the laws of 1997, is amended to read as follows:
    22    (b) Service contracts insured under [a] one or more  service  contract
    23  reimbursement  insurance [policy] policies pursuant to [paragarph] para-
    24  graph one of subsection (c) of section seven thousand nine hundred three
    25  of this article shall contain a statement in substantially the following
    26  form:   "Obligations of the provider under  this  service  contract  are
    27  insured  under a service contract reimbursement insurance policy. If the
    28  provider fails to pay or provide service on a claim  within  sixty  days

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD15495-01-2
        S. 9101                             2

     1  after  proof  of loss has been filed, the contract holder is entitled to
     2  make a claim directly against the insurer  under  the  service  contract
     3  reimbursement  insurance  policy." The service contract shall also state
     4  the  name  and  address  and a toll-free telephone number of the insurer
     5  under [the] each related service contract reimbursement insurance  poli-
     6  cy.
     7    § 3. This act shall take effect immediately.