What's happening
This bill improves consumer disclosure for automobile insurance, creates an independent Public Insurance Consumer Advocate, and establishes related powers and procedures.
Why it matters
Expanded Consumer Access to Information. By requiring a centralized database of auto insurance rates and complaint rankings, the bill empowers consumers to compare both costs and service quality across insurers. This could drive more informed shopping and potentially put downward pressure on premiums through increased competition.
Stronger Consumer Protections and Recourse. The law gives consumers the right to a pro-rata refund if insurers fail to provide mandated disclosures, and ensures that lack of disclosure can’t delay or prevent someone from obtaining coverage. This creates real consequences for insurers who do not comply and provides greater security for policyholders.
Independent Oversight and Representation. The establishment of an independent Public Insurance Consumer Advocate’s office institutionalizes consumer representation in insurance rate-setting and regulatory processes. This office gains significant powers—such as intervening in hearings, accessing departmental records, and recommending legislation—thereby giving consumers a dedicated voice against industry interests.
Accelerated and Transparent Rate Review Processes. The bill mandates prompt hearings (within 15 days) on rate filings or changes if requested by the Advocate or municipalities, and requires detailed public explanations for decisions. This not only speeds up government response to potentially unjustified rate hikes but also increases transparency in how insurance rates are set or challenged.
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Who cares
Headline styles
Require Insurance Info for Drivers
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.
Expand Insurance Price Transparency
In Assembly Committee · Insurance · Sponsor Steven Englebright
Full text
9 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
3109
2019-2020 Regular Sessions
IN SENATE
February 4, 2019
Introduced by Sen. ADDABBO -- 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 improving disclosure to automobile insurance consumers; and to amend the executive law, the insurance law and the state administrative procedure act, in relation to establishing an independent office of public insurance consumer advocate and establishing its powers and duties
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 article 6 to read as follows:
ARTICLE 6
AUTOMOBILE INSURANCE CONSUMER INFORMATION Section 601. Title; legislative declaration and purpose.
602. Automobile insurance consumer information and complaint
rankings.
603. Consumer rating factors.
604. Disclosure procedures.
605. Noninterference with obtaining coverage.
606. Public outreach.
§ 601. Title; legislative declaration and purpose. This article shall be known and may be cited as the "automobile insurance consumer information act".
The legislature finds and declares that automobile insurance is required by law for all residents who drive and that the cost of automobile insurance represents a substantial expense for many consumers. The legislature further finds that the premium costs for any given individual for identical insurance coverage from different licensed insurers can vary widely and that wide variations also exist in the quality of service provided by insurers as measured by the department's annual complaint handling rankings. In addition, the legislature finds that few
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD06853-01-9
S. 3109 2
consumers are aware of these wide cost and quality of service variations, that as a result consumers as a group may pay hundreds of millions of dollars annually for overpriced policies and that individual consumers may encounter unnecessary difficulty in having their automobile insurance claims and complaints handled expeditiously. The legislature further finds and declares that it intends for the superintendent and the department to have broad authority under this article to establish mechanisms to fully inform consumers as to which policies are available to them at the lowest possible cost and which insurers provide the highest quality of service. The legislature intends with this article to create certain disclosure requirements that will make such information more readily available to all consumers. Increased availability of information is intended to make the automobile insurance system more competitive with respect to both cost of coverage and the quality of service.
§ 602. Automobile insurance consumer information and complaint rankings. (a) The superintendent shall maintain a database containing nonbusiness automobile insurance rate information and complaint rankings for all companies licensed to do business in the state.
(b) Every person, upon making an inquiry to the department and providing the information specified in section six hundred three of this article, shall be mailed within five business days, or, at the option of the person, receive at the time of such inquiry:
(1) The names, addresses, telephone numbers and, if appropriate, web site addresses of the five companies having the lowest premiums for the requested package of coverage that would write insurance for such person; the total cost for the package of coverage from each such insurer; and the most recent complaint ranking of each such insurer;
(2) The names, addresses, telephone numbers and, if appropriate, web site addresses of the five companies having the best complaint rankings that would write insurance for such person, and the total cost for the package of coverage from each insurer listed;
(3) An explanation of how to obtain from such companies the names, addresses, telephone numbers, and, if appropriate, web site addresses of those agents, brokers or sales representatives of such companies that are situated in a location reasonably convenient to the person; and
(4) Until such database is established, the department shall provide persons making an inquiry the department's Annual Ranking of Automobile Insurance Complaints and Consumers Guide to Auto Insurance. After the database is established, if the person making an inquiry prefers, the department may provide, in lieu of the information specified in paragraphs one, two and three of this subsection, the department's Annual Ranking of Automobile Insurance Complaints, and Consumer Guide to Auto Insurance.
§ 603. Consumer rating factors. In order to receive the list of lowest cost insurers described in section six hundred two of this article, the person shall provide the following information:
(a) The place in which the vehicle is garaged or stored, or other information needed to determine geographical territory;
(b) The age, sex, marital status and other information needed to determine the driver class of the principal and occasional operators;
(c) The make, model and year of the automobile;
(d) Information relating to qualification for discounts;
(e) Information relating to surcharges or credits based on driving record or driving courses taken;
(f) Desired effective date of the policy;
S. 3109 3
(g) Desired coverages; and
(h) Such other information as the superintendent may by regulation require.
§ 604. Disclosure procedures. Every policy of nonbusiness automobile insurance delivered, issued for delivery, renewed or issued for renewal in this state shall include a notice prescribed by the superintendent in regulation of the availability of the information and procedure for obtaining such information described in sections six hundred two and six hundred three of this article. Such notice shall include the department's address, telephone number and web site address.
§ 605. Noninterference with obtaining coverage. No applicant for automobile insurance shall be prevented or delayed in effecting or applying for coverage by the requirements of section six hundred four of this article. In those cases where, prior to or at the time an application is taken, it is impractical to provide any disclosure documents prescribed by section six hundred four of this article, such documents shall be furnished as soon thereafter as practical and, in any event, no later than at the time the policy is delivered. Where any such document is not provided as required by section six hundred four of this article, the applicant may, no later than thirty days following receipt of the policy, and notwithstanding the provisions of section three thousand four hundred twenty-eight of this chapter, return the policy for a pro rata refund of premiums paid. A clear and conspicuous written notice explaining this refund provision, in language promulgated by the superintendent, shall be delivered with the policy.
§ 606. Public outreach. The department shall conduct public education and outreach to inform consumers as to the availability of and how to access the consumer information prescribed by this article. Notwithstanding any inconsistent law to the contrary, no advertisement utilizing electronic means, (including but not limited to radio, television and the internet) public service announcement or other broadcast produced or distributed pursuant to this section shall feature the likeness, picture or voice of a statewide elected official or a family member of such official.
§ 2. If any provision of section one of this act or the application thereof to any person or circumstances be adjudged invalid by any court of competent jurisdiction, such judgment shall be confined in its operation to the provision or application or persons or circumstances directly involved in the controversy in which such judgment shall have been rendered and shall not affect or impair the validity of the remainder of this act or the application thereof to other persons or circumstances.
§ 3. The executive law is amended by adding a new article 44-A to read as follows:
ARTICLE 44-A
OFFICE OF PUBLIC INSURANCE CONSUMER ADVOCATE Section 945. Office of public insurance consumer advocate.
946. Public insurance consumer advocate.
947. Powers and duties.
§ 945. Office of public insurance consumer advocate. There is hereby created in the executive department an independent office of public insurance consumer advocate (hereinafter referred to in this article as "office") to represent the interests of nonbusiness automobile and health insurance consumers in the state.
§ 946. Public insurance consumer advocate. 1. The governor, with the advice and consent of the senate, shall appoint a public insurance consumer advocate (hereinafter referred to in this article as "advo-
S. 3109 4
cate") who shall serve as the executive director of the office of public insurance consumer advocate and shall receive an annual salary to be fixed by the governor within the amount available therefor by appropriation.
2. (a) To be eligible to serve as advocate, a person must be a resident of the state. The advocate shall be a person who has demonstrated a strong commitment to and involvement in efforts to safeguard the rights of the public, and who possesses the knowledge and experience necessary to practice effectively in insurance proceedings.
(b) A person shall not be eligible for appointment as advocate if such person or the person's spouse:
(i) is employed by or participates in the management of a business entity or other organization regulated by the department of financial services or receiving funds from such department;
(ii) owns or controls, directly or indirectly, more than ten percent interest in a business entity or other organization regulated by the department of financial services or receiving funds from the department of financial services or the office;
(iii) uses or receives a substantial amount of tangible goods, services or funds from the department of financial services or the office, other than compensation or reimbursement authorized by law for the department of financial services or office membership, attendance or expenses.
3. The advocate shall serve for a term of two years.
4. It shall be a ground for removal from office if the advocate:
(a) does not have at the time of appointment the qualifications required by this section;
(b) does not maintain during service as advocate the qualifications required by this section;
(c) violates a prohibition established by this section; or
(d) cannot discharge the advocate's duties for a substantial part of the term for which the advocate is appointed because of illness or disability.
5. The validity of an action of the office shall not be affected by the fact that it is taken when a ground for removal of the advocate exists.
6. (a) A person shall not serve as the advocate or act as the general counsel for the office of advocate if the person is required to register as a lobbyist pursuant to article one-A of the legislative law.
(b) A person serving as the advocate shall not, for a period of two years after the date the person ceases to be an advocate, represent any person in a proceeding before the superintendent of financial services or the department of financial services or receive compensation for services rendered on behalf of any person regarding a case before the superintendent of financial services or the department of financial services.
(c) A person shall not serve as the advocate or be an employee of the office if the person is an officer, employee or paid consultant of a trade association in the field of insurance.
(d) A person who is the spouse of an officer, manager or paid consultant of a trade association in the field of insurance shall not serve as the advocate and may not be an office employee.
(e) For the purposes of this section, a trade association is a nonprofit, cooperative and voluntarily joined association of business or professional competitors designed to assist its members and its industry
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or profession in dealing with mutual business or professional problems and in promoting their common interest.
§ 947. Powers and duties. 1. The advocate, as executive director of the office, shall be charged with the responsibility of administering, enforcing and carrying out the provisions of this article, including preparation of a budget for the office, employing all necessary professional, technical and other employees to carry out provisions of this article, approval of expenditures for professional services, travel, per diem and other actual and necessary expenses incurred in administering the office. The compensation of employees of the office shall be fixed by the advocate within the appropriation provided therefor.
2. The office shall file annually with the governor, temporary president of the senate and speaker of the assembly a complete and detailed written report accounting for all funds received and disbursed by the office during the preceding fiscal year. The annual report shall be in the form and reported as part of the executive budget.
3. All money paid to the office under this article shall be deposited in the state treasury.
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 improving disclosure to automobile insurance consumers; and to amend the executive law, the insurance law and the state administrative procedure act, in relation to establishing an independent office of public insurance consumer advocate and establishing its powers and duties
Purpose or general idea of bill
To enact reforms to protect consumers and reduce premiums, including creation of an Office of Insurance Consumer Advocate, making premium and complaint information available to consumers from the department of financial services, and allowing municipalities to petition for reductions in auto insurance rates.
Summary of provisions
*Establish an Office of Insurance Consumer Advocate (the "office") in the executive department to represent consumers in ratemaking and other matters
Read the full memo (656 words)
*Establishes the position of Public Insurance Consumer Advocate ("the advocate")
*Requires the superintendent of the department of financial services to maintain a database containing automobile insurance rate information and complaint rankings for all companies licensed to do business in the State
*Requires the department to hold hearings when called for by the advo- cate
*The office shall create an annual report with accounting for all funds received and disbursed by the office.
*The office may assess the impact of insurer practices and insurance rates and advocate on behalf of positions that are most advantageous to a substantial number of insurance consumers.
*Authorize municipalities to petition the department of financial services for rate changes; the department must hold a public hearing within 15 days of receipt of such petition
*Requires auto insurance rate filings to include full statistical justi- fication and conform to standards of uniformity established by the Superintendent in regulation
Justification
New York's special Task Force on Automobile Insurance was created to investigate the cost and availability of private passenger auto insur- ance in New York State, and to review the effectiveness of laws due to expire that year that regulate access to, and affordability of these policies. The task made findings and recommendations in its report:
"Asleep at the Wheel, 1994-1998, NY's Move to the Top of the List in Auto Insurance Rates,"
(http://assembly.state.ny.us/Reports/Auto/199805/).
Among the Task Force findings is that overly generous rate increases granted to New York auto insurers have led New York to the brink of becoming the most expensive state for auto insurance in the nation. The Task Force found that during the period 1990-1996, New York average auto insurance premiums jumped by 36;, while the costs of providing coverage went up by a mere 12% (countrywide premiums increased by only 20%, closely tracking an 1E0 rise in costs).
With premiums rising faster than costs, insurer profits have soared. In 1996, New York insurers' profits on insurance transactions were twice as high as those of their counterparts in the rest of the country.
Rankings released in March 1999 by the National Association of Insurance Commissioners show a disturbing continuance of these trends. For the second year in a row, New York is the second most expensive state in the nation for auto insurance, with rates 35 above the national average. At the same time, New York insurers are pocketing underwriting profits four times the national average, and profits on insurance transactions more than 1501 above the national norm.
Modeled on such an office in Texas, it is expected that this new office could match that state's experience, in which auto insurance consumers saved $549 million in 1997, $602 million in 1996, and $778 million in 1995.
Aiming to reverse New York's move to the top of the list in auto rates, the Task Force developed a comprehensive package of reforms, which, when fully implemented, could save consumers over $1 billion on auto insur- ance premiums per year.
Prior legislative history
2017: S4469 - REFERRED TO INSURANCE 2018: S4469 - REFERRED TO INSURANCE
Fiscal implications for state and local governments
None.
Effective date
This act shall take effect immediately, with provisions.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.