New York Insurance Regulation Changes per COVID-19

Guidance to Insurance Producers Regarding Electronic Delivery of Notices Pursuant to New 11 NYCRR § 229.5(b) and 3 NYCRR § 405.6(b)(4)



The Department of Financial Services (“Department”) is aware of insurance producers (“Producers”) facing challenges complying with the notice obligations in new 11 NYCRR § 229.5(b) and 3 NYCRR § 405.6(b)(4) described below (“Notice Obligations”).

First, regarding obtaining consumers’ consent to electronic communications, please see the Department’s “Current Guidance Regarding Electronic Signatures, Transactions, and Filings with DFS.

Second, the Department is accommodating Producers by reducing their burden to fulfill the Notice Obligations during the current state of emergency.  Specifically, for the duration of the current state of emergency, Producers may comply with the Notice Obligations by emailing the notices to the consumers for which the Producers have email addresses, regardless of whether the consumers have consented to receiving this notice via email.  Model notices, designed for Producers to use in meeting the Notice Obligations, can be found at the bottom of this page.

Producers with websites should post the information on their websites as soon as possible.  The Department also encourages supplemental dissemination of the content of the Notice Obligations by other means, including social media.

Finally, Producers should maintain records of their communications with consumers, electronic or otherwise, used to satisfy the Notice Obligations for a period of time sufficient to satisfy applicable statutes of limitation and, where an action or claim is pending, for such period of time until the matter is resolved.  See Office of General Counsel Opinion 05-03-32 (March 24, 2005).  In addition, if a Producer obligated itself by contract with its principal, the insurer or insured, to retain records for a period of time, then such obligation, if legally enforceable, must be satisfied, subject to an alternative acceptable to the principal.  These communications used to satisfy the Notice Obligations may be subject to Department review, including but not limited to, on examination.

Below is a summary of the insurance producer requirement in the relevant emergency regulations.

New 11 NYCRR § 229.5(b) and 3 NYCRR § 405.6(b)(4) require a licensed insurance producer who services an in-force life insurance policy, annuity contract, or fraternal benefit society certificate or who procured a property/casualty insurance policy for the policyholder or contract holder to mail or deliver notice to the policyholder or contract holder of the provisions of 11 § NYCRR 229 and 3 NYCRR § 405.6 within ten business days following the promulgation of 11 § NYCRR 229 and 3 NYCRR § 405.6.

Below are links to model notices that Producers can use to satisfy their Notice Obligations described above.  PRODUCERS MUST ONLY SEND THE APPROPRIATE NOTICE TO THE APPROPRIATE CONSUMERS TO AVOID CONFUSION.

  1. Model Notice for Notifying Holders of Life Insurance Policies or Annuity Contracts
  2. Model Notice for Notifying Holders of Certain Property/Casualty Insurance Policies

IMPORTANT REMINDER:  The Notice Obligations to property/casualty policyholders only apply to certain kinds of policies affected by the emergency regulations and therefore may only be sent to holders of those specific kinds of policies to avoid confusion.  The types of policies are explained in general terms in the model property/casualty notice linked above.  The precise categories of policies are set forth in detail in the emergency regulations. Specifically, see 11 NYCRR § 229.2(m) in the emergency regulations for the definition of “Property/casualty insurance policy.”

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