Bill S1527-2009

Restricts insurers from demanding intrusive personal, financial and tax information from insureds as a standard practice in ordinary theft claims

Restricts insurers from demanding intrusive personal, financial and tax information from insureds as a standard practice in processing ordinary theft claims where no special circumstances warranting a demand for such information exists.

Details

Actions

  • Jan 6, 2010: REFERRED TO INSURANCE
  • Feb 2, 2009: REFERRED TO INSURANCE

Memo

 BILL NUMBER:  S1527

TITLE OF BILL : An act to amend the insurance law, in relation to restricting insurers from demanding intrusive personal, financial and tax information from insureds as a standard practice in processing ordinary theft claims

PURPOSE : Restricts insurers from demanding intrusive personal, financial and tax information from insureds as a standard practice in ordinary theft claims.

SUMMARY OF PROVISIONS : Adds a new section 2616 to the Insurance Law, to restrict insurers from demanding intrusive personal, financial and tax information from an insured as a standard practice in ordinary theft claims.

JUSTIFICATION : Requests for personal and financial information which has nothing to do with a theft claim made by an insured are inappropriate and intrusive. For example, companies have requested copies of personal and business tax returns, license and registration, other permits or licenses held in NYS, loan applications filed, statements setting forth the county and state in which the insured was registered to vote over the last five years, copies of any bank statements, and copies of any "Doing Business As" Certificates or Certificates of Incorporation for any businesses owned in addition to requiring that the insured make a recorded statement regarding the circumstances of the theft. While an insurance company has a right to information pertinent to the claim in question, clearly many of these demands go beyond being reasonable requests and are exceedingly onerous and intrusive.

LEGISLATIVE HISTORY : S.7060 of 2006 Referred to Insurance S.3897 of 2007-2008 Referred to Insurance

FISCAL IMPLICATIONS : None.

EFFECTIVE DATE : January 1 provided, however, that effective immediately, the addition, amendment and/or repeal of any rules and regulations necessary for the implementation of this act on its effective date is authorized and directed to be made and completed on or before such effective date.

Text

STATE OF NEW YORK ________________________________________________________________________ 1527 2009-2010 Regular Sessions IN SENATE February 2, 2009 ___________
Introduced by Sen. MORAHAN -- 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 restricting insurers from demanding intrusive personal, financial and tax information from insureds as a standard practice in processing ordinary theft claims THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. The insurance law is amended by adding a new section 2616 to read as follows: S 2616. INTRUSIVE REQUESTS FOR PERSONAL, FINANCIAL AND TAX INFORMA- TION; ORDINARY THEFT CLAIMS. (A) IT SHALL BE AN UNFAIR CLAIM SETTLEMENT ACT OR PRACTICE UNDER PARAGRAPHS THREE AND FOUR OF SUBSECTION (A) OF SECTION TWO THOUSAND SIX HUNDRED ONE OF THIS ARTICLE FOR AN INSURER, IN THE COURSE OF INVESTIGATING OR SETTLING A THEFT CLAIM, TO DEMAND OF ITS INSURED PERSONAL, FINANCIAL AND TAX INFORMATION UNLESS SPECIAL ARTICULA- BLE CIRCUMSTANCES HAVE BEEN DISCOVERED WHICH DIRECTLY RELATE TO THE PARTICULAR INDIVIDUAL FACTS OF SUCH THEFT AND WHICH WARRANT THE MAKING OF SUCH DEMAND FOR THE SPECIFIC PURPOSE OF DETERMINING IF SUCH CLAIM IS FRAUDULENT. (B) AS USED IN THIS SECTION, A DEMAND FOR PERSONAL, FINANCIAL AND TAX INFORMATION IS A DEMAND THAT ANY OF THE FOLLOWING MATERIAL OR INFORMA- TION BE PROVIDED: (1) COPIES OF THE INSURED'S PERSONAL AND BUSINESS TAX RETURNS; (2) PERMITS OR LICENSES WHICH THE INSURED HOLDS IN NEW YORK STATE OTHER THAN THOSE FOR OPERATING A MOTOR VEHICLE; (3) LOAN APPLICATIONS WHICH THE INSURED FILED; (4) STATEMENT SETTING FORTH THE COUNTY AND STATE IN WHICH THE INSURED HAS BEEN REGISTERED TO VOTE OVER A PERIOD OF TIME, OTHER THAN FROM HIS OR HER PRESENT RESIDENCE; (5) COPIES OF ANY BANK STATEMENTS OF BANKS IN WHICH THE INSURED HAS ACCOUNTS;
(6) COPIES OF ANY "DOING BUSINESS AS" CERTIFICATES OR CERTIFICATES OF INCORPORATION FOR ANY BUSINESS THE INSURED OWNS; OR (7) INFORMATION OR MATERIAL OF A SIMILAR PERSONAL, FINANCIAL, TAX OR PRIVATE NATURE WHICH THE SUPERINTENDENT BY REGULATION FINDS TO BE INTRU- SIVE OR WHICH CONSTITUTES AN UNWARRANTED INVASION OF PRIVACY IN THE CONTEXT OF A STANDARD OR ORDINARY THEFT CLAIM. S 2. This act shall take effect on the first of January next succeed- ing the date on which it shall have become a law, provided, however, that effective immediately, the addition, amendment and/or repeal of any rules or regulations necessary for the implementation of the foregoing section of this act on its effective date are authorized and directed to be made and completed on or before such effective date.

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