Relates to contractual liability insurance policies; provides that each provider may maintain a maximum of five service contract reimbursement insurance policies insuring its service contracts actively offered.
Summary
S05048 amends the Insurance Law provision governing service contract reimbursement insurance policies. The bill changes the language requiring a provider to insure the performance of “all” of its obligations under service contracts, and instead specifies that each provider may maintain up to five service contract reimbursement insurance policies covering its actively offered service contracts. The measure also retains the existing requirement that, if a provider fails to maintain the required insurance or if the insurance lapses or is terminated, the provider must comply with one of the alternative statutory options within 45 days.
In practical terms, the bill is aimed at clarifying how many reimbursement insurance policies a service contract provider may use at one time and how those policies may be structured for active offerings. It does not create a new regulatory scheme, but it modifies the conditions under which providers satisfy their obligations under the service contract insurance framework in the Insurance Law. The bill takes effect immediately upon enactment.
Impact
The bill would amend section 7903(c)(1) of the Insurance Law, which governs service contract reimbursement insurance policies for service contract providers. It would replace the prior reference to insuring “all” obligations with a rule allowing each provider to maintain a maximum of five reimbursement insurance policies for actively offered service contracts, while preserving the existing fallback requirements if coverage lapses or is terminated. The affected parties are service contract providers, insurers authorized in New York, and excess line licensees involved in procuring such coverage.
Sentiment
There is limited recorded legislative discussion or voting history available for this bill, so overall sentiment cannot be measured from committee debate or floor votes. Based on the bill text and caption, the measure appears technical and administrative in nature, suggesting a generally procedural rather than controversial purpose. The absence of recorded opposition or votes in the provided materials indicates no documented public controversy in the available record.
Contention
The main point of potential contention is the policy choice to permit a provider to maintain up to five separate service contract reimbursement insurance policies rather than requiring a single policy covering all obligations. Supporters would likely view this as a flexibility and compliance clarification for providers and insurers, while critics might question whether multiple policies could complicate oversight or consumer protection. No specific opposing viewpoints, committee objections, or recorded vote-based disputes are included in the provided materials.
Same As
Relates to contractual liability insurance policies; provides that each provider may maintain a maximum of five service contract reimbursement insurance policies insuring its service contracts actively offered.
Relates to contractual liability insurance policies; provides that each provider may maintain a maximum of five service contract reimbursement insurance policies insuring its service contracts actively offered.
Relates to contractual liability insurance policies; requires the insurer to either discharge the obligations of the provider under the terms of the service contract, or in the event of the provider's nonperformance, cancellation of the service contract.
Relates to contractual liability insurance policies; requires the insurer to either discharge the obligations of the provider under the terms of the service contract, or in the event of the provider's nonperformance, cancellation of the service contract.