The Office of General Counsel issued the following informal opinion on June 5, 2002, representing the position of the New York State Insurance Department.
Re: Policy Record Retention Requirements & Regulation 152
Which New York State Insurance Department regulation governs the retention of issued policy records, and their contents, by insurance companies?
N.Y. Comp. Codes R. & Regs. tit. 11, § 243.2(b)(1) (2001) (Regulation 152) governs the retention of issued policy records, and their contents, by insurance companies.
The insured (the "Insured") obtained a policy of comprehensive insurance, effective April 28, 1987, to April 28, 1988, for its inventory from the insurer (the "Insurer"). Insured sustained covered losses in May of 1987, but Insurer denied Insureds claim. As a result of the denial, Insured timely commenced an action against Insurer. Insured later suffered a fire at its main premises in 1991 which resulted in the loss of its original copy of the policy.
After the completion of jury selection, but before the formal opening of trial, the judge assigned to the case ruled that Insurers affidavit from an earlier summary judgment motion, with an appended policy, was inadmissible as hearsay and dismissed the complaint for lack of proof due to the following: (a) Insured could not produce the original policy; and (b) counsel for Insurer alleged that the company "was no longer in business" and that none of its successors could find a copy of the policy.
N.Y. Comp. Codes R. & Regs. tit. 11, § 243.2 (1996) (Records Required for Examination Purposes and Retention Period) provides in part that:
(b) Except as otherwise required by law or regulation, an insurer shall maintain:
(1) A policy record for each insurance contract or policy for six calendar years after the date the policy is no longer in force or until after the filing of the report on examination in which the record was subject to review, whichever is longer. Policy records need not be segregated from the policy records of other states as long as they are maintained in accordance with the provisions of this Part. A separate copy need not be maintained in an individual policy record, provided that any data relating to a specific contract or policy can be retrieved pursuant to Section 243.3(a) of this Part. A policy record shall include:
(i) The policy term, basis for rating, and return premium amounts, if any;
(ii) The application, including any application form or enrollment form for coverage under any insurance contract or policy;
(iii) The contract or policy forms issued including the declaration pages, endorsements, riders, and termination notices of the contract or policy. Binders shall be retained if a contract or policy was not issued; and
(iv) Other information necessary for reconstructing the solicitation, rating, and underwriting of the contract or policy.
N.Y. Comp. Codes R. & Regs. tit. 11, § 243.2(b)(1) (1996) (Regulation 152).
Please take note that Regulation 152 became effective September 1, 1996. The New York State Insurance Department has, therefore, attached hereto a copy of an opinion dated October 15, 1995, which provides informal guidelines issued by the Department prior to the effective date of Regulation 152.
The above opinion is informal and not binding on any court. For further information you may contact Attorney Kristian Earl Lynch at the New York City Office.