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 September 26, 2001, representing the position of the New York State Insurance Department.

Re: Legal Services Insurance

Question Presented:

May an excess line broker procure legal services insurance from an unauthorized insurer?

Conclusion:

No. N. Y. Ins. Law § 2105 (a) (McKinney 2000) restricts the kinds of insurance which an excess line broker may procure from an unauthorized insurer. Legal services insurance as defined in N. Y. Ins. Law § 1113 (a)(29) (McKinney 2000) is not among those kinds. Such

insurance may only be written by authorized insurers licensed to transact legal services insurance in New York.

Facts:

The inquirer is a licensed New York excess line broker who wishes to procure stand-alone legal services insurance to be issued through certain underwriters at Lloyds of London, an unauthorized insurer in New York. He reviewed Circular Letter No. 8 (2000) but did not understand whether an excess line broker is permitted to procure such insurance from an unauthorized insurer.

Analysis:

Legal services insurance is among the kinds of insurance authorized to be written in New York pursuant to N. Y. Ins. Law § 1113 (a)(29) (McKinney 2000). An authorized insurer may write legal services insurance, provided it is licensed to transact legal services insurance.

An excess line broker may procure from an unauthorized insurer only those kinds of insurance specified in N. Y. Ins. Law § 2105 (a) (McKinney 2000) as follows: "paragraphs four

through fourteen, sixteen, seventeen, nineteen, twenty, twenty-two and twenty-seven of subsection (a) of section [1113] of this chapter and in subsection (h) of this section…"

Since paragraph twenty-nine of N. Y. Ins. Law § 1113 (a) (McKinney 2000) is not among those kinds of insurance specified in N. Y. Ins. Law § 2105 (a) (McKinney 2000), an excess line broker is not permitted to procure legal services insurance from an unauthorized insurer, including underwriters at Lloyds of London.

For further information you may contact Associate Attorney Jeffrey A. Stonehill at the New York City Office.