What's happening
This bill allows certain liability insurance policies in New York to cover punitive damages and civil penalties, with specific exceptions.
Why it matters
Expands insurance options for businesses and organizations. , allowing them to obtain coverage for punitive damages and civil penalties that were previously uninsurable, thus reducing the financial risks associated with lawsuits alleging gross negligence or reckless conduct.
Excludes personal and commercial auto policies. , meaning individuals and companies cannot use this coverage for personal, non-business insurance or for commercial auto liability, focusing the change primarily on general liability and similar business policies.
Limits coverage for intentional harm. , ensuring that insurance cannot be used to cover damages resulting from actions intended to cause harm, thereby maintaining a deterrent against purposeful wrongdoing even as other non-compensatory liabilities become insurable.
Applies only to future policies. , meaning the change will not affect existing insurance contracts, but could influence the structure and pricing of liability insurance products moving forward, potentially impacting business costs and legal strategies.
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Who cares
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Allow Punitive Damages Coverage
Plain English, a few words. Used as the page title.
Sponsors
No co-sponsors yet.
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.
Allow Insurance for Punitive Damages
In Senate Committee · Insurance · Sponsor Neil D. Breslin
Full text
1 pageUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
6251
2019-2020 Regular Sessions
IN ASSEMBLY
March 4, 2019
Introduced by M. of A. DINOWITZ -- read once and referred to the Committee on Insurance
AN ACT to amend the insurance law, in relation to permitting certain liability policies to provide coverage for punitive damages and civil penalties
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 3421 to read as follows:
§ 3421. Punitive damages and civil penalties coverage. 1. An insurer may provide and an insured may purchase insurance against an award of punitive damages, or civil penalties, or other non-compensatory damages in any liability insurance policy except in a policy of personal lines insurance issued to a natural person for non-business purposes, or a commercial automobile liability insurance policy.
2. Coverage may provide protection for vicarious liability resulting from the conduct of another, or when assessed against a party directly for gross negligence or reckless conduct. Coverage shall not apply where liability results from action that was intended to cause the resulting harm, damage or injury. Coverage shall apply only when expressly provided for by the insurance policy.
3. This section shall apply prospectively to insurance policies with effective dates on or after the effective date of this section.
§ 2. This act shall take effect immediately.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD06423-01-9
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.