What's happening
This bill removes the requirement for certain medical malpractice insurance to be obtained from authorized insurers, allowing excess line coverage.
Why it matters
Increases flexibility for hospitals, physicians, and dentists. by allowing them to obtain medical malpractice insurance from excess line (unauthorized) insurers, rather than being limited to authorized insurers or specific insurance plans/associations, which could result in more tailored or potentially less expensive coverage options.
Could impact the oversight and security of malpractice coverage. since excess line insurers are not subject to New York State supervision or insolvency protections, meaning providers risk less regulatory protection and patients could face challenges if insurers become insolvent.
May influence the medical malpractice insurance market in New York. by increasing competition and possibly putting pressure on authorized insurers and state-run plans to adjust rates or offerings to retain clients, potentially affecting overall insurance costs and market dynamics.
Requires clear written disclosure to insured parties. about the risks of choosing excess line coverage, ensuring that hospitals, physicians, and dentists are informed that these insurers are not regulated by the state and that state insolvency protections do not apply.
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Who cares
General hospitals, physicians and dentists
The bill would allow brokers placing their medical malpractice coverage in the excess-line market to forgo a plan or association declination if the insured is first advised that coverage is available there.
Excess-line insurance brokers
The bill would remove the special declination requirement for these medical malpractice placements while retaining written disclosures about unauthorized insurers and the lack of New York insolvency fund protection.
Unauthorized medical malpractice insurers
The bill would remove a prerequisite for brokers placing hospital, physician and dentist coverage with them.
Medical malpractice insurance plans and associations
Brokers would no longer have to obtain their declination for these placements if the insured receives advance notice of available coverage.
Headline styles
Change Malpractice Insurance Rules
Plain English, a few words. Used as the page title.
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.
Change Medical Malpractice Insurance Rules
In Assembly Committee · Insurance · Sponsor Neil D. Breslin
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
157
2019-2020 Regular Sessions
IN ASSEMBLY (Prefiled)
January 9, 2019
Introduced by M. of A. CAHILL, STECK, HEVESI, GARBARINO, QUART, HUNTER -- read once and referred to the Committee on Insurance
AN ACT to amend the insurance law, in relation to excess line coverage for certain medical malpractice insurance
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Subsection (e) of section 2118 of the insurance law, as added by chapter 684 of the laws of 1993, subparagraph (A) of paragraph 2 as amended by chapter 587 of the laws of 2002, subparagraph (C) of paragraph 2 as amended by chapter 498 of the laws of 1996, is amended to read as follows:
(e)(1) Except as provided in paragraph two of this subsection, no licensee shall be required to obtain a declination from an association established pursuant to article fifty-four or fifty-five of this chapter, or to apply for insurance through a plan established pursuant to article fifty-three of this chapter, as a condition of procuring insurance pursuant to this section.
(2) (A) Unless the licensee obtains a declination from the appropriate association, or from an insurer pursuant to an application for coverage through a plan, no diligent effort shall be considered to have been made if the insurance is available from the plan or association in connection with the placement of:
(i) a policy of non-commercial motor vehicle liability insurance; or
(ii) [medical malpractice insurance for a general hospital, as defined in subdivision ten of section two thousand eight hundred one of the public health law, a physician or dentist; or
(iii)] insurance which by law must be provided by an authorized insurer.
(B) In connection with the placement of any other kind of insurance, a declination from the appropriate association, or from an insurer pursu-
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD00091-01-9
A. 157 2
ant to an application for coverage through a plan, shall be required unless prior to the placement the insured has been advised of the availability of insurance from the plan or association.
(C) The affirming broker shall provide written notice to the insured that the placement was made with an unauthorized insurer. A copy of this notice shall be attached to the affirming broker's affidavit. The affidavits required by this section to be completed by the affirming broker shall include a statement that the affirming broker advised the insured in writing:
(i) that the unauthorized insurer with which the coverage is being placed is not authorized to do an insurance business in this state and is not subject to supervision by this state;
(ii) that in the event of the insolvency of the unauthorized insurer, losses will not be covered by any New York state insolvency fund;
(iii) that the policy may not be subject to all of the regulations of the superintendent pertaining to policy forms; and
(iv) such other information as the superintendent may, by regulation, require.
§ 2. This act shall take effect immediately.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.