Relates to the listing of group policyholders in a directory

1 Co-sponsor

• Antoine M. Thompson

BILL NUMBER:S6949A

Title of bill

An act to amend the insurance law, in relation to authorizing the issuance of group policies for service providers listed in a commercial directory

Purpose or general idea of bill

To authorize the issuance of group policies guaranteeing the performance of contracts entered into by providers of services who are listed in commercial directories.

Summary of provisions

This bill would add a new §3453 to the Insurance Law which would authorize the issuance of group policies guaranteeing the performance of contracts entered into by service providers who are listed in commercial directories. The group policy would be issued to the publisher of the commercial directory and premium could be paid by the directory publisher, the service providers advertising in the directory or the cost could be shared between the publisher and the service providers. The amount of coverage shall not exceed $5,000 for each contract guaranteed by the coverage.

Justification

This legislation is necessary in order to allow the SuperGuarantee Program, or programs similar to it, to continue to operate in New York State. Through the SuperGuarantee Program, if a consumer (1) uses a service provider identified as a SuperGuarantee service provider in the yellow page directory and (2) registers for the program on the SuperGuarantee website, then in the event that the consumer encounters a problem with the service of such provider, the yellow pages publisher would initiate a dispute resolution process between the consumer and the provider. If the consumer is not satisfied with the outcome of that process, the yellow pages publisher would provide payment to the consumer. Payment would be for the lowest estimate of two other service providers to correct the problem or the amount charged under the contract between the consumer and the original SuperGuarantee service provider, not to exceed $500. There is no cost to the consumer for participating in the Program.

The Insurance Department has made the determination that the SuperGuarantee Program constitutes the business of insurance under New York law. Enactment of this legislation is necessary in order for the Program to continue operating in New York. The SuperGuarantee Program provides a legitimate benefit to the consumer at no cost to the consumer. At a

time when both the time and finances of many New Yorkers are limited, the SuperGuarantee Program can help to ensure that New York consumers are able to resolve disputes with service providers satisfactorily, while minimizing the time and hassle involved. If this legislation is not enacted, this valuable consumer service could not be offered to consumers in New York State.

Prior legislative history

New Bill.

Fiscal implications

None Noted.

Effective date

Immediately.