What's happening
This bill requires insurers to provide a Homeowners' Bill of Rights and consumer guide on insuring against catastrophic losses from natural disasters.
Why it matters
Empowering Consumers. The bill requires insurers to provide detailed, plain-language disclosures about what is and isn’t covered in property insurance policies—including limitations, exclusions, deductibles, and claim procedures. This helps consumers better understand their protections and obligations before disaster strikes.
Transparency During Disasters. Insurers must inform policyholders if their coverage changes due to a declared emergency (state or federal), ensuring that consumers are aware of any policy modifications at critical times when they may need to file claims.
Options for Gaps in Coverage. If a policy lacks coverage for natural disasters (like floods or hurricanes), insurers must proactively inform consumers about additional coverage options, including state and federal programs. This can help homeowners avoid surprise gaps in protection.
Accountability for Insurers. The bill adds penalties for insurers that misrepresent policy provisions or fail to provide required disclosures and timelines, aiming to reduce unfair claim denials and slow processing, and giving policyholders clearer recourse if their rights are violated.
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Who cares
Homeowners and businesses buying property insurance
They would receive plain-language disclosures at issuance and renewal explaining coverage, exclusions, deductibles, claims procedures and rights when claims are denied or settlement offers rejected.
Property insurers and insurance producers
Insurers would face detailed disclosure requirements, and insurers or producers would have to explain additional coverage options when policies exclude specified disaster or weather damage.
Insurance claimants
The bill would add knowing misrepresentation or failure to provide required policy facts, along with noncompliance with policy provisions and claims time frames, to the unfair claims settlement practices law.
State insurance regulators
The superintendent would prescribe or approve disclosure notices and issue, update and post a consumer guide covering catastrophic-loss insurance for homeowners and businesses.
Headline styles
Homeowners Insurance Rights Guide
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.
Require Homeowners Bill of Rights
In Assembly Committee · Insurance · Sponsor Michael Cusick
Full text
3 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
3866
2019-2020 Regular Sessions
IN SENATE
February 20, 2019
Introduced by Sen. LANZA -- 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 creating a homeowners' bill of rights and a consumer guide on insuring against catastrophic loss caused by natural disasters
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 3444-a to read as follows:
§ 3444-a. Homeowners' bill of rights. (a) Any insurer that writes personal lines insurance or commercial lines insurance policies that cover loss of or damage to real property, personal property, or other liabilities for loss of or damage to property shall, upon issuance and renewal of any such policy or contract, provide to an insured or potential insured written detailed disclosure in a notice prescribed or approved by the superintendent describing clearly and in plain language the following:
(1) any and all coverage for loss caused by certain occurrences, including but not limited to fire, wind, windstorm, mudslide, hurricane, snow, ice, water surge, or flood, coverages provided under the policy, any limitations on or exclusions from coverage, circumstances that would invalidate coverage under the policy, any applicable deductibles, and when such deductibles shall be triggered;
(2) all information related to claims investigation and processing, including but not limited to the process by which the insured may file a claim, all applicable time frames required by law and regulation, all necessary proof of loss information and other information the insurer may require from the insured, the process by which the insured may file a complaint with the department, and any other information deemed necessary by the superintendent;
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD10009-01-9
S. 3866 2
(3) any and all rights a claimant has under the laws and policy when a claim is denied or when the claimant rejects a settlement offer from the insurer, including their right to file a complaint with the department;
(4) that the provisions of this policy may be modified or changed pursuant to state or federal law when a local state of emergency is declared pursuant to section twenty-four of the executive law, when the governor declares a disaster emergency pursuant to section twenty-eight of the executive law, or when the President of the United States issues a major disaster or emergency declaration pursuant to the Robert T. Stafford Disaster Relief and Emergency Assistance Act (P.L. 93-288) and how the insured may obtain information about any such modifications or changes;
(5) information on how the insured may contact the insurer, including the insurer's business hours, mailing address, phone number, fax number, website address and email; and
(6) information on how the insured can obtain the consumer guide on insuring against catastrophic losses created by the department pursuant to section three hundred thirty-eight of this chapter and any other guides, pamphlets, or other information the department has made publicly available that would be beneficial to the insured.
(b) In the event that a policy subject to subsection (a) of this section does not include coverage for damage as a result of weather conditions, natural disasters, or other occurrences, including but not limited to fire, wind, windstorm, mudslide, hurricane, snow, ice, water surge, or flood, the insurer or producer shall, upon issuance and renewal of any such policy or contract, provide to an insured or potential insured information on any additional coverage options, including additional policies and riders, the New York Property Insurance Underwriting Association, the Coastal Market Assistance Program, the National Flood Insurance Program, and any other options authorized by state or federal law.
§ 2. Paragraphs 7 and 8 of subsection (a) of section 2601 of the insurance law, paragraph 7 as amended and paragraph 8 as added by chapter 458 of the laws of 2018, are amended and a new paragraph 9 is added to read as follows:
(7) submitting reasonably rendered claims to the independent dispute resolution process established under article six of the financial services law; [or]
(8) artificially deflating or otherwise lowering cost data used for adjusted claims, or using cost data that is not appropriate for the region of the state where the loss occurred; this shall include but is not limited to claims adjusted by a person issued a temporary permit pursuant to subsection (n) of section two thousand one hundred eight of this chapter[.]; or
(9) knowingly misrepresenting or failing to provide pertinent facts of policy provisions to claimants as required by section three thousand four hundred forty-four-a of this chapter and not complying with such policy provisions, including established time frames for investigation, claims processing and settlement, and payment of claims.
§ 3. The insurance law is amended by adding a new section 338 to read as follows:
§ 338. Consumer guide on insuring against catastrophic losses. (a) Six months after the effective date of this section, the superintendent shall issue and update, as necessary, a consumer guide on insuring against catastrophic losses that shall contain comprehensive information
S. 3866 3
written in plain language in a clear and understandable format, including the following:
(1) the ways in which different types of weather conditions, natural disasters, or other occurrences can cause catastrophic losses, including but not limited to damage from fire, wind, windstorm, mudslide, hurricane, snow, ice, extreme cold, water surge, and flood;
(2) the types of insurance available that provide coverage against catastrophic losses for both homeowners and businesses, a listing of companies that provide such coverage, and recommendations as to how best to shop for and compare prices, service and quality of insurance coverage;
(3) a list of the exclusions typically found in such coverage and information on how a consumer may obtain coverage for such exclusions, including a listing of companies that provide such coverage and an explanation of, information on, and the types of coverage available from the New York Property Insurance Underwriters Association, the Coastal Market Assistance Program, and the National Flood Insurance Program, and other options authorized by state or federal law;
(4) steps a consumer can take to prepare for a natural disaster or other catastrophic loss;
(5) steps a consumer can take following a catastrophic loss in order to facilitate the timely processing of the consumer's insurance claim and an explanation of policyholders' rights as provided in law and regulation; and
(6) a department toll free consumer hot-line and website address through which consumers may initiate complaints, and request general information about insurance.
(b) The requirements set forth in subsection (a) of this section may be satisfied by separate or supplemental publications and updates.
(c) The superintendent shall post the consumer guide on insuring against catastrophic losses on the department's website.
§ 4. 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 creating a homeowners' bill of rights and a consumer guide on insuring against catastrophic loss caused by natural disasters
Purpose or general idea of bill
The purpose of this bill is to establish a Homeowners' Bill of Rights that would educate consumers about the details of their insurance poli- cies and their rights under the law.
Summary of specific provisions
Section 1 of the bill would amend the Insurance law by adding a new section 3444-a, the "Homeowners Bill of Rights." This section would obligate certain insurers to provide to insured or potentially insured parties written disclosures describing: coverage or limitations on coverage for losses caused by certain catastrophic occurrences, informa- tion related to claims investigation and processing, the rights of the insured under the law, that the provisions of the policy could be modi- fied or changed pursuant to state or federal law following a disaster or emergency, the insurer's contact information, information on obtaining the Consumer's Guide on Insuring Against Catastrophic Losses, and any other information deemed necessary by the Superintendent. In addition, when the insured's policy does not include coverage for certain catastrophic occurrences, the insurer would be required to provide information on additional coverage options.
Read the full memo (782 words)
Section 2 of the bill would amend Section 2601 of the insurance law to include a new paragraph (7). This paragraph would state that the knowing misrepresentation of or failure to provide pertinent facts of policy provisions to claimants, and the failure to comply with those policy provisions, shall constitute an unfair claim settlement practice.
Section 3 of the bill would add a new section 338 to the Insurance law. This section would instruct the Superintendent to create a Consumer's Guide on Insuring Against Catastrophic Losses, and outlines the informa- tion which the Superintendent must include in the Guide. The Guide would include the ways in which certain occurrences can cause catastrophic losses, the types of insurance that provide coverage against catastroph- ic losses, information on which type of weather, and natural disasters. Other occurrences and catastrophic losses are typically excluded from insurance policies but it will include how a consumer may obtain cover- age for those exclusions, steps a consumer can-take to prepare for a natural disaster (or other catastrophic loss), steps a consumer can take to facilitate the timely processing of an insurance claim, an explana- tion of policyholder's rights in law and regulation, and a department toll-free consumer hotline and website address through which consumers may initiate complaints and request general information about insurance. The department would be able to satisfy these requirements through sepa- rate or supplemental publications and updates, and the Superintendent would be required to post the "Consumer Guide on insuring Against Catastrophic Losses" on the Department's website.
Justification
Following Superstorm Sandy and Tropical Storms Irene and Lee, many poli- cyholders were surprised that their insurance company either rejected their claim or offered them a settlement amount that was significantly lower than the cost of the damages. Many policyholders thought that their existing insurance policy provided sufficient coverage for water damage and other catastrophic losses caused by these storms. Often, there were long delays in the investigation and settlement of claims, leaving home and business owners in limbo for weeks, sometimes months. It became clear to the victims of these storms that insurance policies can be complex, the claims process can be burdensome for the policyhold- er, and insurance companies can be unresponsive at a time when assist- ance is needed the most. Policyholders should be made aware of the different insurance coverage options available, the benefits of each option, and their rights under the law.
This bill would address these issues by requiring insurers to provide insureds and prospective insureds with a notice containing a Homeowners' Bill of Rights. The notice would inform consumers of the coverage provided and any exclusions, how they can obtain additional coverage, their rights under the law, and other information that will educate consumers about their insurance coverage. This will ensure that policy- holders have coverage that meets their needs.
Prior legislative history
2018: S.6166 - Referred to Insurance / A.8552 - Referred to Insurance 2017: S.6166 - Referred to Insurance / A.8552 - Referred to Insurance 2016: S.4048 - Referred to Insurance 2015: S.4048 - Referred to Insurance 2014: S.3045 - Referred to Insurance 2013: S.3045 - Referred to Insurance
Fiscal implications for state and local governments
To be determined.
Effective date
This act shall take effect on the same date and in the same manner as section 27 of part H of chapter 60 of the laws of 2014 takes effect.
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