For all those interested in pending bills in the New York Assembly and Senate, the Council of Insurance Brokers of Greater New York issued its latest legislative report.  The following is a portion of the report as it appeared on CIB’s Website with added hyperlinks.

VICARIOUS LIABILITY

Once again the legislation to end New York’s vicarious liability law, holding car dealers and makers liable for damages when leased vehicles are in accidents, did not pass, as it is opposed by the powerful Trial Lawyers Association.  While S.1410 (Johnson) was reported to the Senate calendar on 3/17/05, it was never considered in the Upper House for an actual vote.

In the Assembly, the political theater was even more interesting, as the bill was bottled up in committee. A.2620 (Canestrari) was scheduled for consideration on the Assembly Transportation Committee agenda on 6/7/05.  The Committee Chair, Assemblymember David Gantt (D-Monroe) predicted that the 24 member committee was evenly split on the measure.  In an attempt to break the logjam, Assembly Minority Leader Charles Nesbitt (D-Orleans), substituted a proponent of the bill, Assemblymember James Tedisco (R-Schenectady) for ranking minority member Assemblymember Patrick Manning (R-Dutchess).  Speaker Sheldon Silver countered this move by promoting co-sponsor and proponent of the bill, Assemblymember Robert Sweeney (D-Suffolk) to the Assembly Rules Committee, leaving a vacancy on the Transportation Committee, thus ensuring that a “Yes” vote on the bill in committee would fail by one vote.

Proponents of the bill predict that if the bill was allowed to come to a vote in either House of the Legislature, it would pass by wide margins.

SAFE WORKPLACE

CIB urged that the Legislature address the problems associated with general and specialty contractor’s absolute liability under NY Labor Law Sections 240, 241 & 241-a, detailing how current law adversely affects the general liability insurance marketplace.  It is difficult to find affordable coverage for general contractors and nearly impossible for roofers and riggers.

While all parties were sympathetic to the plight of contractors, and to their brokers & agents who cannot place coverage for them, there was the acknowledgment that this is a major political problem that cannot be resolved until all of the stakeholders, including organized labor, trial lawyers, contractors, brokers & agents, carriers, etc., sit down with the Legislature and the Governor’s office to negotiate a workable settlement.  In view of this political reality, none of the bills relating to reform of the so-called “scaffolding laws,” S.3823 (Volker) / A.2946-A (Morelle) and S.3255 (Volker) / A.1181 (Morelle), were even considered.

STATE INSURANCE FUND (SIF)

CIB made the argument that SIF is an unregulated entity that is out of control.  Originally created to be the workers’ comp residual fund or insurer of last resort, SIF now enjoys a 40+ % share of the workers’ comp market in New York and continues to aggressively seek more business with unlicensed representatives.  SIF has an unfair competitive advantage over the voluntary market, since it pays no taxes, offers no commissions to brokers or agents, etc.  Moreover, SIF abuses consumers by requiring 30-days advance notification of cancellation of coverage and short rates rather than pro-rates insured’s premiums upon cancellation.

There was considerable interest by Legislators and NYSID representatives to study the SIF problem further, and to possibly work with CIB on corrective legislation.

   AUTO FRAUD

While a number of bills were introduced to address auto insurance fraud, including cracking down on organized insurance fraud rings, none were the subject of agreement between the Senate and Assembly.   A.8357-A (Grannis), the omnibus no-fault insurance fraud prevention act, made it to the floor of the Assembly, but was laid aside on the calendar.  It has no Senate companion bill.  While the bill has many salutary provisions to combat auto fraud, it also contains a number of problematic sections, such as triggering the unfair claims settlement practices law by virtue of a single act, rather than first establishing a general pattern of such practices.

A.2218 (Lafayette), which would make it unlawful to procure an individual to obtain services meant to defraud an insurance carrier, was never even considered in the Assembly Insurance Committee.  Moreover, there was no Senate companion bill.

A.3682 (Lafayette), which would require mandatory arbitration as the initial remedy for dispute resolution, again was never considered by the Assembly Insurance Committee.  And, again, there is no Senate companion bill.

A.1956 (Lafayette), which would allow for the cancellation of commercial auto policies that were procured with intent to commit fraud, was never brought by the Assembly Insurance Committee.  There is no Senate companion bill.

WORKERS’ COMPENSATION

CIB has stressed that New York continues to be a high cost/low weekly benefit state and that reforms to the underlying system must ultimately be made to mitigate rates.

A.8764 (Rules by John), the omnibus workers’ compensation benefits improvement act, would, amongst other things, increase average weekly benefits up to an indexed 2/3 of the average weekly wage.  It would also allow collective bargaining agents to choose a different workers’ comp. carrier than the one selected by the employer.  The bill never left the Assembly Labor Committee.  There was no Senate companion legislation.

The workers’ comp. issue continues to be a major bone of contention between organized labor and business groups.  Likewise, the paid family leave act, A.1301 (Nolan), which passed the Assembly, but S.1501 (Morahan), its Senate companion, did not.

CIB is supportive of a workers’ comp. related bill, A.1305 (Nolan) / S.3798 (Leibell), which would phase in an increase of the maximum weekly non-occupational disability benefit from $170 to $340 per week.  Unfortunately, the bill was bottled up in the Assembly Ways & Means and Senate Labor Committees.

Thank you to CIB.