The office of General Counsel issued the following informal opinion on February 12, 2001, representing the position of the New York State Insurance Department.
Re: International Medical Insurance
May a licensed insurance agent provide quotes in New York for "international medical insurance policies" offered by unauthorized insurers?
No. This would be a violation of N. Y. Ins. Law §2117 (McKinney 2000).
The inquiry is from an Internet company hereinafter referred to as ABC.com. ABC.com and/or its president are licensed as an agent in New York to sell life, health and auto insurance. Its web site provides quotes for various lines of insurance. ABC.com is considering offering quotes for and selling international medical insurance policies in New York. It describes an international medical insurance policy as either a policy that covers a United States citizen traveling abroad or a policy that covers foreign nationals traveling in the United States. The insurers that would underwrite these policies are not licensed in New York.
N. Y. Ins. Law §2117(a) (McKinney 2000) provides that:
No person, firm, association or corporation shall in this state act as agent for any insurer or health maintenance organization which is not licensed or authorized to do an insurance or health maintenance organization business in this state, in the doing of any insurance or health maintenance organization business in this state or in soliciting, negotiating or effectuating any insurance, health maintenance organization or annuity contract or shall in this state act as insurance broker in soliciting, negotiating or in any way effectuating any insurance, health maintenance organization or annuity contract of, or in placing risks with, any such insurer or health maintenance organization, or shall in this state in any way or manner aid any such insurer or health maintenance organization in effecting any insurance, health maintenance organization or annuity contract.
Clearly, by offering quotes and selling these policies in New York, ABC.com would be acting as an agent for the unlicensed insurer and, accordingly, would be in violation of the statute regardless of where the risk is located. Although N. Y. Ins. Law §2117 (McKinney 2000) does contain exceptions to this general prohibition, none are applicable to these facts.
N. Y. Ins. Law §2105 (McKinney 2000) provides for the issuance of an excess line brokers license that would, in certain circumstances, allow the licensee to procure, subject to certain restrictions, policies of insurance from insurers that are not authorized to transact business in New York. However, this authority is restricted to certain kinds of insurance and, except in regard to a very narrow situation, does not include health insurance.
For further information you may contact Associate Attorney Joan Siegel at the New York City Office.