What's happening
This bill sets prompt standards for insurers to investigate and settle property and liability claims during declared emergencies in New York.
Why it matters
Establishes clearer and faster timelines for insurers. Insurers must now acknowledge claims, inspect damages, and communicate decisions within set deadlines, reducing uncertainty and wait times for policyholders after disasters.
Allows for emergency repairs and flexible proof of loss. Homeowners can make immediate repairs (to things like windows, roofs, and heating) to protect their safety, and can use alternative documentation (photos, receipts, etc.) to support their claims—important when traditional paperwork may be lost or inaccessible after an emergency.
Improves transparency and accountability. Insurers are required to give written explanations for claim decisions, including the right to appeal, which helps consumers understand their options and ensures companies follow fair practices.
Empowers state oversight. The superintendent of insurance can create detailed regulations to enforce these standards, potentially leading to stronger consumer protections and more consistent handling of disaster-related claims across all insurers.
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Who cares
Headline styles
Faster Disaster Insurance Payouts
Plain English, a few words. Used as the page title.
Sponsors
2 Co-sponsors
History
- Referred to insurance
- Referred to insurance
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Faster Disaster Insurance Payouts
Assembly Floor Calendar · Sponsor James Skoufis
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
1476
2017-2018 Regular Sessions
IN SENATE
January 9, 2017
Introduced by Sen. CARLUCCI -- 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 standards for prompt investigation and settlement of claims arising from states of emergency
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. The insurance law is amended by adding a new section 2616 to read as follows:
§ 2616. Standards for prompt investigation and settlement of claims. (a) This section shall apply to every insurer who writes policies that cover loss of or damage to real property, personal property or other liabilities for loss of, damage to, or injury to persons or property when a local state of emergency is declared pursuant to section twentyfour of the executive law, when the governor declares a disaster emergency pursuant to section twenty-eight of the executive law, or when the President issues a major disaster or emergency declaration pursuant to the Robert T. Stafford Disaster Relief and Emergency Assistance Act (P.L. 93-288), for claims arising from such emergency.
(1) An insurer shall acknowledge the receipt of all claims in writing to the claimant or the claimant's authorized representative in accordance with regulations promulgated by the superintendent;
(2) If the insurer wishes its investigation to include an inspection of damaged or destroyed property, the inspection, whether performed by the insurer, an independent adjuster, or other representative of the insurer, shall occur in accordance with regulations promulgated by the superintendent. Furthermore, where necessary to protect the health and safety of the claimant, immediate repairs to windows, exterior walls, exterior doors, roofs, heating systems, water systems and electrical systems may be made and alternative proof of loss such as photographs,
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD01815-01-7
S. 1476 2
video recordings, inventories and all receipts for repairs or replacement property shall satisfy policy requirements;
(3) A claim filed with an agent of an insurer shall be deemed to have been filed with the insurer unless, consistent with law or contract, the agent notifies the person filing the claim that the agent is not authorized to receive notices of claim; and
(4) An insurer shall furnish to such claimant, or claimant's authorized representative, a notification of all items, statements and forms, if any, which the insurer reasonably believes will be required of the claimant in order to investigate such claim in accordance with regulations promulgated by the superintendent.
(b)(1) An insurer shall, within fifteen business days of receipt of all items, statements and forms requested under this section from the claimant, or the claimant's authorized representative, advise the claimant in writing whether the insurer has accepted or rejected the claim.
(2) An insurer shall be granted a one-time extension of fifteen business days to determine whether a claim should be accepted or rejected. If the insurer elects to utilize this extension, it shall so notify the claimant, or the claimant's authorized representative, in writing. Such notification shall include the reasons additional time is needed for the investigation.
(3) Once the claim is accepted by the insurer, the insurer shall advise the claimant, or the claimant's authorized representative, in writing of the amount the insurer is offering to settle the claim. The insurer shall also provide to the claimant, or the claimant's authorized representative, in writing, of all applicable policy provisions regarding the claimant's right to reject and appeal the offer.
(4) In any case where the claim is rejected by the insurer, the insurer shall notify the claimant, or the claimant's authorized representative, in writing, of all applicable policy provisions regarding the claimant's right to appeal the decision.
(c) An insurer shall pay the claim not later than three business days from the settlement of the claim.
(d) The superintendent may promulgate any rules or regulations necessary to implement the provisions of this section.
§ 2. This act shall take effect immediately.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the insurance law, in relation to standards for prompt investigation and settlement of claims arising from states of emergency
Purpose
The purpose of this bill is to establish claim investigation and settlement standards for insurance companies to follow in the event of a disaster.
Summary of provisions
Section 1. Adds a new section 2616 to the insurance law to require every insurer authorized to write policies in New York State that cover loss or damage to real property, personal property, or other liabilities for loss of, damage to, or injury to persons or property to begin investigating a claim arising from a declared disaster or emergency and inform the insured of all items, statements, and forms that the insurer believed will be required of the claimant in accordance with regulations promulgated by the Superintendent of Financial Services. If the insurer wishes the investigation to include an inspection of damaged or destroyed property, such inspection would have to occur in accordance with regulations promulgated by the Superintendent. In addition, insurers would have to allow claimants to make certain repairs necessary to protect health and safety and to accept an alternative proof of loss from the claimant.
Read the full memo (641 words)
Within fifteen business days after receiving all the items, statements, and forms that the insurer required from the claimant, the insurer would be required to advise the claimant in writing whether the insurer has accepted or rejected the claim. An insurer would be allowed a one-time extension of fifteen additional business days to continue its investigation, provided that the insurer notifies the claimant of the reasons additional time is needed for the investigation.
If the insurer has accepted the claim, the claimant would have to be notified of the amount the insurer is offering to settle the claim and of all applicable policy provisions regarding the claimant's right to reject and appeal the insurer's offer. If the insurer rejects the claim, the insurer would have to inform the claimant of all applicable policy provisions regarding the claimant's right to appeal the decision. An insurer would be required to pay the claim not later than three business days from the settlement of the claim.
Section 2. Effective date.
Justification
When a disaster or emergency strikes, policyholders frequently rely on their insurance policies to be made whole again. Insurance payouts are often necessary for homeowners and businesses to make repairs or to replace damaged property. In addition, repairs often need to be made quickly in order to ensure the health and safety of the policyholders and the community. Moreover, a delay in insurance payments can result in a delay in FEMA assistance, as FEMA will not provide payment for damages until insurance claims are fully processed.
Following Superstorm Sandy and Tropical Storms Irene and Lee, it was found that there were often lengthy delays in the time it was taking insurance companies to investigate and process claims and make payments to policyholders. Following Sandy, the Department of Financial Services found it necessary to issue an emergency regulation that required insurers to begin an investigation within 6 business days of receiving a Sandy-related claim; if the insurer sought an inspection of the damaged property, the inspection would have to be performed within those 6 business days.
This bill would address this issue by requiring insurers to respond to a claim arising from a disaster or emergency in accordance with regulations established by the Superintendent of Financial Services, accept or reject a claim within fifteen business days of closing the investigation, and pay a claim within three business days of the claim being settled.
Legislative history
2013 - S3413-A/A1092-A: Insurance Committee/Passed Assembly 2014 - Insurance Committee/Insurance Committee 2015-16 - S1398/A4458: Insurance/passed assembly
Fiscal implications
None.
Effective date
This act shall take effect immediately.
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