BILL NUMBER:  S2808

 TITLE OF BILL :  An act to amend the insurance law, in relation to
establishing a private right of action for unfair claim settlement
practices by an insurer

 PURPOSE :

This bill amends the insurance law by establishing a private right of
action for consumers who have been affected by unfair claims practices
by insurers and also provides for punitive damages where there is a
finding of an insurer's willful or knowing violation of section 2601
of the insurance law. The bill would apply to any loss or injury
sustained relating to an insurance claim for property damage in an
area affected encompassed by executive order declaring a disaster
emergency as per section twenty-eight of the Executive Law.

 SUMMARY OF PROVISIONS :

Section 1 would create a private right of action for any unfair claims
practices by insurers relative to a disaster emergency as per section
twenty-eight of the Executive Law.

Section 2 is the effective date.

 JUSTIFICATION :
              

Unfortunately, there is evidence that some insurers have taken
advantage of insured as concerns the adjusting of losses sustained in
disaster emergencies declared by the Governor pursuant to section
twenty-eight of the Executive Law.

Insurers have every right to attempt to lawfully deny claims, but all
too often these attempts create unreasonable situations for homeowners
attempting to simply access the benefits to which they are entitled.
This is especially acute in situations where the homeowner may have
lost most or even all of their possessions due to a storm declared
emergency.

This bill would allow insureds to institute claims against their
insurers for unfair claims practices proscribed by the Insurance Law.
More importantly, this bill would amend section 2601 of the Insurance
Law to allow insured homeowners who have suffered property loss to
take direct action against their insurers for unfair claims practices
where the claimed losses were sustained within the area declared as a
disaster emergency. A private right of action is necessary, in
addition to the possibility of administrative action, to make certain
that insurers are held responsible for unfair claims practices.

Additionally, this proposal would permit an award of punitive damages
for an insurer's willful unfair claims practices in violation of
section 2601 of the insurance law.

 LEGISLATIVE HISTORY :

S.4223 of 2015-16.

 FISCAL IMPLICATIONS :

None.

 EFFECTIVE DATE :
Immediately.