Relates to claims for loss or damage to real property; creates continuing education requirements for licensed persons and qualifications for public and independent adjusters; allows for a revocation of licenses with an opportunity to reapply for such licenses.
TITLE OF BILL: An act to amend the insurance law, in relation to claims for loss or damage to real property, continuing education for licensed persons and qualifications for independent adjusters
This bill intends to curb the potential for fraud and abuse by unscrupulous public or independent insurance adjusters. It does so by:
*Requiring continuing education for public and independent insurance adjusters;
*Prohibiting an adjuster from receiving anything of value in exchange for a referral of a potential client;
*Prohibiting any public or independent adjuster from having a controlling interest in any construction, salvage or building appraisal firm; and
*Allowing and setting the conditions under which the Insurance Superintendent may revoke, suspend or refuse to renew the license of public or independent adjusters.
SUMMARY OF PROVISIONS:
Section 1 adds a new § 2616 to the Insurance Law, to prohibit an insurer from requiring repairs to be completed by any particular entity or individual and from suggesting or recommending a particular entity or individual unless specifically asked by the insured, in which case the insurer would have to disclose any controlling or business interest that it has in any entity or individual that it recommends or suggests.
Sections 2 and 3 amend various subsections of § 2108 of the Insurance Law, to require that independent adjusters participate in continuing education.
Section 4 amends subsection (a) of § 2110 of the Insurance Law and allows the superintendent of the Insurance Department to refuse to renew, revoke, or suspend the license of any insurance agent, insurance broker, reinsurance intermediary, insurance consultant or adjuster that has violated any law regarding his or her professional capacity, for a duration the superintendent deems appropriate. The superintendent can also suspend or refuse to renew a license for a duration that he or she determines adequate to discipline a violation of this section.
Section 5 amends paragraph 2 of subsection (c) of § 2132 of the insurance law to indicate that during the same calendar year biennial licensing period, independent adjusters may use accumulated continuing education credits to meet the requirements of similar classes of licenses. In doing so, independent adjusters are provided the same benefit as public adjusters.
In the past decade, fraud committed by a small number of unscrupulous public and independent adjusters has placed a black cloud over much of the insurance industry. The actions of these few have caused undue harm to both policy holders and adjusters who operate under the highest professional standards. Most of those accused of committing fraud have pled guilty, received fines and or jail time. To date, many of them retain their New York State licenses.
This legislation will help the adjusting industry rid itself of "bad apples" by imposing continuing education requirements and imposing revocation and suspension guidelines for public and independent adjusters alike.
The bill will also prevent conflicts of interest that may arise when an insurer or adjuster has controlling interest in a construction firm. For example, an insurance company may consult a sister construction firm in which it has controlling interest -- to adjust housing repair claims.
In return for the free adjustment, the construction firm may receive the contract for the repairs or other construction. A conflict of interest arises when the construction company receives such a contract and inflates the estimate, resulting in higher premiums to policy holders. This practice causes a public interest to be violated due to the lack of objectivity.
The bill helps avoid such conflicts in three ways. First, it prevents insurers from requiring repairs be made by a particular construction firm. If recommendations are made that repairs be done by a particular firm, the insurer must disclose to the insured whether the insurer has a controlling interest in such firm. Second, it prohibits public and independent adjusters from paying or giving gifts to people or companies in exchange for potential client referral. Third, it prohibits public or independent adjusters from having any controlling interest in a construction, salvage or appraisal firm.
2004 - S.4752-B - Passed Senate A.6915 - Referred to Assembly Insurance Committee 2003 - S.4752 - Referred to Senate Insurance Committee A.6915 Referred to Assembly Insurance Committee 2002 - S.2067 - Referred to Senate Insurance Committee A.6009-A Referred to Assembly Insurance Committee 2001 - S.2067 - Referred to Senate Insurance Committee A.6009-A Referred to Assembly Insurance Committee 2000 - A.6592 - Referred to Insurance 2012: 01/26/11 referred to insurance 01/04/12 referred to insurance 06/05/12 amend and recommit to insurance 06/05/12 print number 3729a 06/12/12 reported referred to codes 06/20/12 reported referred to rules 06/20/12 reported 06/20/12 rules report cal. 467 06/20/12 ordered to third reading rules cal. 467 06/21/12 passed assembly 06/21/12 delivered to senate 06/21/12 REFERRED TO RULES
None to the state.
This act shall take effect on the first of January after it shall have become law.
STATE OF NEW YORK ________________________________________________________________________ 5183--A 2013-2014 Regular Sessions IN SENATE May 14, 2013 ___________Introduced by Sen. MARTINS -- read twice and ordered printed, and when printed to be committed to the Committee on Insurance -- recommitted to the Committee on Insurance in accordance with Senate Rule 6, sec. 8 -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee AN ACT to amend the insurance law, in relation to claims for loss or damage to real property, continuing education for licensed persons and qualifications for independent adjusters 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. CLAIMS FOR LOSS OR DAMAGE TO REAL PROPERTY; REPAIRS. (A) WHEN- EVER AN INSURED SUFFERS A LOSS OR DAMAGE TO REAL PROPERTY, NO INSURER PROVIDING COVERAGE THEREFOR SHALL REQUIRE THAT REPAIRS BE COMPLETED BY A PARTICULAR ENTITY OR INDIVIDUAL. (B) IN PROCESSING ANY SUCH CLAIM, THE INSURER SHALL NOT RECOMMEND OR SUGGEST REPAIRS BE MADE BY A PARTICULAR ENTITY OR INDIVIDUAL UNLESS EXPRESSLY REQUESTED BY THE INSURED, IN WHICH CASE THE INSURER SHALL DISCLOSE TO THE INSURED WHETHER THE INSURER HAS A CONTROLLING OR BUSI- NESS INTEREST IN ANY ENTITY OR INDIVIDUAL THAT THE INSURER RECOMMENDS OR SUGGESTS. S 2. Paragraph 1 of subsection (f) of section 2108 of the insurance law is amended to read as follows: (1) The superintendent shall, in order to determine the trustworthi- ness and competency to act as an independent adjuster of each individual applicant for such license, and of each proposed sub-licensee, except in the case of a renewal license, require every such individual to take and pass, to the satisfaction of the superintendent, a personal written examination. AN INDIVIDUAL SHALL NOT BE DEEMED QUALIFIED TO TAKE THE EXAMINATION WITHOUT HAVING DEMONSTRATED BY EVIDENCE SATISFACTORY TO THEEXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD03815-03-4 S. 5183--A 2
SUPERINTENDENT THAT: (A) THE INDIVIDUAL POSSESSES A MINIMUM OF ONE-YEAR'S EXPERIENCE IN THE INSURANCE BUSINESS, WITH INVOLVEMENT IN SALES, UNDERWRITING, CLAIMS, OR OTHER EXPERIENCE CONSIDERED SUFFICIENT BY THE SUPERINTENDENT; OR (B) THE INDIVIDUAL SUCCESSFULLY COMPLETED FORTY HOURS OF FORMAL TRAINING IN A COURSE, PROGRAM OF INSTRUCTION, OR SEMINARS APPROVED BY THE SUPERINTENDENT. The superintendent may prescribe the types of written examinations according to the kind or kinds of insurance claims
[which]THAT the applicant is to be licensed to investigate and adjust. S 3. Subsection (r) of section 2108 of the insurance law, as added by chapter 264 of the laws of 1998, is amended to read as follows: (r) (1) The following continuing education requirements shall apply to resident and non-resident persons licensed as public OR INDEPENDENT adjusters. (2) Resident and non-resident persons licensed as public OR INDEPEND- ENT adjusters and any person previously so licensed whose license was not in effect on the effective date of this subsection and who has subsequently been relicensed pursuant to the provisions of this article, shall biennially satisfactorily complete such courses or programs as may be approved by the superintendent, as follows: (A) Any person holding a license as a public OR INDEPENDENT adjuster shall, during each full biennial licensing period, satisfactorily complete courses or programs of instruction or attend seminars as may be approved by the superintendent equivalent to fifteen credit hours of instruction. (B) During the same calendar year biennial licensing period, a licen- see may use accumulated continuing education credits to meet the requirements of similar classes of licenses including those authorized by subsection (b) of section two thousand one hundred three, section two thousand one hundred four, section two thousand one hundred seven of this article with respect to general insurance consultants, and THIS section [two thousand one hundred eight of this article]with respect to public AND INDEPENDENT adjusters. (C) Excess credit hours accumulated during any biennial licensing period shall not carry forward to the next biennial licensing period for that same class of license. (3) (A) The courses or programs of instruction successfully completed, which shall be deemed to meet the superintendent's standards for contin- uing education shall be: (i) Courses, programs of instruction or seminars, approved as to meth- od and content by the superintendent, covering portions of the principal branches of insurance related to the kinds of insurance covered by the public OR INDEPENDENT adjusting license, and given by a degree confer- ring college or university whose curriculum is registered with the state education department at the time the person takes the course, whether such course be given as part of such curriculum or separately, or by any other institution, association, trade association or insurer, which maintains equivalent standards of instruction and which shall have been approved for such purpose by the superintendent. (ii) Continuing education as required by the state in which a non-re- sident licensee resides and maintains an office, provided the super- intendent deems them equivalent to New York continuing education requirements. If the state in which the non-resident licensee resides and maintains an office has no continuing education requirements, or the superintendent does not deem them equivalent, the licensee must satisfy New York continuing education requirements.S. 5183--A 3
(B) The number of credit hours assigned to each of the courses or programs of instruction set forth in paragraph one of this subsection shall be determined by the superintendent. (4) A person who teaches any approved course of instruction or who lectures at any approved seminar, and who is subject to these continuing education requirements shall be granted the same number of credit hours as would be granted to a person taking and successfully completing such course, seminar or program, provided that such credit hours shall be credited only once per approved course during any biennial licensing period. (5) Every person subject to these continuing education requirements shall furnish, in a form satisfactory to the superintendent, written certification attesting to the course or programs of instruction taken and successfully completed by such person, and executed by the sponsor- ing organization or its authorizing representative. (6) (A) Any person failing to meet applicable continuing education requirements shall not be eligible to renew the license. (B) Any person whose license was not renewed shall not be eligible to become relicensed during the next biennial licensing period until that person has demonstrated to the satisfaction of the superintendent that continuing education requirements for the last biennial licensing period were met. (C) Any person whose license was not renewed pursuant to subparagraph (A) of this paragraph, who accumulates sufficient credit hours for the prior licensing period to qualify for relicensing in the biennial period following such non-renewal, may not apply those same credit hours toward the continuing education requirements for the current biennial licensing period. (7) (A) Any entity eligible to provide continuing education courses, programs of instruction, or seminars shall file for approval by the superintendent on a biennial basis, to conform with its areas of instruction, a provider organization application and a course submission application for each course, program, and seminar. (B) The provider organization application shall include the names of all instructors to be used during the contract period, and instructors may be added during the period by notifying the superintendent and paying the appropriate filing fee. (C) The completed applications shall be returned in a timely manner, as specified by the superintendent with a non-refundable filing fee of two hundred dollars per organization, fifty dollars per course, program, and seminar, and fifty dollars per instructor. (D) Approval of the application shall be at the discretion of the superintendent. (8) Each licensee shall pay a biennial fee of ten dollars per license, for continuing education certificate filing and recording charges, to the superintendent, or, at the direction of the superintendent, directly to an organization under contract to provide continuing education admin- istrative services. S 4. The opening paragraph of subsection (a) of section 2110 of the insurance law, as amended by chapter 499 of the laws of 2009, is amended to read as follows: The superintendent may refuse to renew, revoke, or may suspend for a period the superintendent determines the license of any insurance producer, insurance consultant, PUBLIC OR INDEPENDENT adjuster or life settlement broker, if, after notice and hearing, the superintendent determines that the licensee or any sub-licensee has:S. 5183--A 4
S 5. Paragraph 2 of subsection (c) of section 2132 of the insurance law, as amended by chapter 264 of the laws of 1998, is amended to read as follows: (2) During the same calendar year biennial licensing period, a licen- see may use accumulated continuing education credits to meet the requirements of similar classes of licenses, as follows: (A) subsection (a) of section two thousand one hundred three and section two thousand one hundred seven of this article with respect to life insurance consultants; or (B) subsection (b) of section two thousand one hundred three, section two thousand one hundred four, section two thousand one hundred seven of this article with respect to general insurance consult- ants, and section two thousand one hundred eight of this article with respect to public AND INDEPENDENT adjusters. S 6. This act shall take effect on the first of January next succeed- ing the date on which it shall have become a law.