Relates to uninsured and underinsured motorist coverage for ambulance services, volunteer fire departments and volunteer ambulance services

BILL NUMBER:S7312B

Title of bill

An act to amend the insurance law, in relation to uninsured and underinsured motorist coverage for ambulance services, volunteer fire departments and voluntary ambulance services

Purpose

To ensure that volunteer firefighters and ambulance crews, while acting in the scope of their duties shall be covered by the maximum available supplemental uninsured/underinsured motorist coverage in an insurance policy that names such volunteer fire department or ambulance service as a named insured.

SUMMARY OF PROVISIONS:; This bill amends section 3420(f) of the insurance law pertaining to mandatory uninsured motorist coverage and optional supplemental uninsured/underinsured motorist coverage ("SUM") by clarifying the definition of the term "named insured" when the "named insured" is a corporate or business entity or a volunteer fire department or volunteer ambulance service.

This bill provides that an insurance policy that includes SUM coverage that names a volunteer fire department or ambulance service as a named insured shall be deemed to provide the maximum SUM coverage available under that particular policy to any individual who is a member of such volunteer fire department or ambulance service, regardless of whether the individual is an additional named insured under that policy, or is a named insured, or is covered under any other policy providing SUM coverage.

Justification

This issue arises because the mandatory New York SUM endorsement required by II NYCRR Section 60-23 defines the term "insured" to mean, in relevant part, "You, as the named insured and, while residents of the same household, your spouse and the relatives of either you or your spouse.. ." II NYCRR Sect 60-2.3(f)(1). Starting with Buckner v. MVAIC, 66 NY2d 211 (1985) and continuing with an increasing number of Appellate Division decisions since, our Courts have consistently held that when the "named insured" is an entity such as a a volunteer fire department, the individual officers. directors, employees or volunteers will not be covered as "named insureds" even when they were injured within the scope of their duties for the insured entity. While these individuals might still be covered under 11NYCRR Section 60-2.3(f)(2) if they were "occupying" a covered vehicle, the definition of "named insured" as interpreted by our Courts creates a gap in coverage for employees and volunteer firefighters and ambulance crews injured by uninsured or underinsured vehicles in the scope of their duties for the "named insured" entity while outside of a covered vehicle.

This means that unless the definition of the term "insured" is clarified a volunteer fire department, or ambulance service will be

unable to provide SUM coverage to its officers, employees or members who face risks from uninsured or underinsured vehicles in the course of their employment after exiting from covered vehicles. The danger is particularly acute for volunteer firefighters and ambulance crews, all of whom are exposed to vehicle hazards after they have exited a covered vehicle.

Legislative history

New bill.

Fiscal implications

None.

Effective date

120th day after it shall become law and shall apply to any policies issued or renewed on or after such date. Effective immediately, the addition, amendment and/or repeal of any rules or regulations necessary for the implementation of this act on its effective date are authorized to be made on or before such effective date.