New York State Seal
STATE OF NEW YORK
INSURANCE DEPARTMENT
25 BEAVER STREET
NEW YORK, NEW YORK 10004

The Office of General Counsel issued the following informal opinion on May 2, 2001, representing the position of the New York State Insurance Department.

RE: Assessment Corporation Licensing Issues

Questions Presented:

1) Does the New York Insurance Law permit an assessment co-operative property/casualty insurance company to be licensed in another state?

2) Does the New York Insurance Law permit a foreign insurer to become licensed as an assessment co-operative property/casualty insurance company in New York?

Conclusions:

1) The New York Insurance Law does not prohibit an assessment co-operative property/casualty insurance company from becoming licensed in another state.

2) Pursuant to N.Y. Ins. Law § 6602(d) (McKinney 2000), a foreign insurer may not become licensed as an assessment co-operative property/casualty insurance company in New York. However, a corporation that complies with N.Y. Ins. Law § 6603 (McKinney 2000) requirements may be organized, and become licensed as, an assessment co-operative property/casualty insurance company in New York.

Analysis:

The New York Insurance Law does not prohibit an assessment co-operative property/casualty insurance company from becoming licensed in another state. However, a corporation’s charter, defined by N.Y. Ins. Law § 107(a)(14) (McKinney 2000) as "the basic instrument, by whatever name called, prescribing the powers, purposes and organization of a corporation", must be amended to provide for the corporation conducting business in another state. N.Y. Ins. Law § 1206 (McKinney 2000) requires the filing in the office of superintendent any certificate of change, amendment or restated charter for the superintendent’s approval. N.Y. Ins. Law § 1206(b) (McKinney 2000) provides:

Any corporation proposing to file a certificate of change of name or a restated or amended charter shall serve upon the superintendent a copy of the proposed changes, not less than thirty days before the meeting at which such changes will be submitted.

N.Y. Ins. Law § 6602(d) (McKinney 2000) states:

No foreign or alien insurer or insurance organization shall be licensed or permitted to do in this state any kind or kinds of insurance business specified in this article on the assessment plan, or on any mutual plan, other than as a mutual property/casualty insurance company or as a reciprocal insurer as elsewhere provided in this chapter.

Thus, a foreign insurer may not become licensed as an assessment co-operative property/casualty insurance company in New York. However, a corporation that complies with N.Y. Ins. Law § 6603 (McKinney 2000) requirements, including, among other things, maintaining a principal office in New York, may be organized, and become licensed as, an assessment co-operative property/casualty insurance company in New York.

For further information you may contact Attorney Sally Geisel at the New York City Office.