N.Y.: PIANY advocacy successfully removes insurance application from new insurance disclosure law

January 4, 2022

Gov. Kathy Hochul signed the Comprehensive Insurance Disclosure Act (S.7052/A.8041) into law last week. The new law requires the defendants in civil lawsuits to provide plaintiffs with complete information for any insurance policy through which a judgment could be satisfied early in civil proceedings.

Previously, attorneys had to request insurance-policy information before it would be provided to them. The new law not only mandates the disclosures of policy information—it places an affirmative obligation on defendants and their insurance carriers to ensure that all insurance information remains accurate and complete, too.

PIANY’s advocacy

Among the documents that must be included in the insurance disclosures, is the insurance application. PIANY opposed this bill and advocated for the removal of insurance applications from the required disclosures. The association argued that including the insurance application would expose private client information—such as health, financial and employment information—unnecessarily, without providing any additional relevant insurance information. According to PIANY, if any information on the application is relevant to the policy, it would be included on policy forms that would be part of the required disclosures already. Hochul agreed with PIANY.

However, even though the Comprehensive Insurance Disclosure Act was signed with the insurance application still a part of the disclosures, Hochul indicated in her signing message that she had reached an agreement on chapter amendments to this law already—and Hochul’s office informed PIANY that insurance applications were removed from the provisions of the bill. (Unfamiliar with what chapter amendments are? Review the term in PIANY’s legislative glossary.)

PIANY thanks its members who participated in the association’s grassroots campaign that urged Hochul to take the exact steps she did to amend this law. And, the association thanks Hochul for her support of the insurance industry.

Impact on agents

This law should have minimal impact on insurance producers. Most of the insurance information required to be disclosed by this law already is disclosed in civil lawsuits routinely. Now, the disclosure of the information will occur earlier in the civil proceedings and without attorneys needing to ask for it. Disclosure will be the responsibility of the policyholder and their insurance carrier.

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About the author…

Bradford J. Lachut, Esq.

Bradford J. Lachut, Esq., joined PIA as government affairs counsel for the Government & Industry Affairs Department in 2012 and then, after a four-month leave, he returned to the association in 2018 as director of government & industry affairs responsible for all legal, government relations and insurance industry liaison programs for the five state associations. Prior to PIA, Brad worked as an attorney for Steven J. Baum PC, in Amherst, and as an associate attorney for the law office of James Morris in Buffalo. He also spent time serving as senior manager of government affairs as the Buffalo Niagara Partnership, a chamber of commerce serving the Buffalo, N.Y., region, his hometown. He received his juris doctorate from Buffalo Law School and his Bachelor of Science degree in Government and Politics from Utica College, Utica, N.Y. Brad is an active Mason and Shriner.

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