The Office of General Counsel issued the following opinion on April 9, 2003, representing the position of the New York State Insurance Department.
Re: Termination of Property and Casualty Personal Lines Insurance Agents.
Question Presented:
Is Department Circular Letter No. 4 (1984) still in effect or has it been modified or withdrawn?
Conclusion:
Department Circular Letter No. 4 (1984) is still in effect and is based on the statutory language now contained in N.Y. Ins. Law § 3425(j) (McKinney Supp. 2003). See also §§ 3425(m) and (n) for new additional requirements.
Facts:
None were presented.
Analysis:
The statutory citations found in Circular Letter No. 4 (1984) have been superseded by N.Y. Ins. Law §§ 3425(j), (m) and (n) because the Insurance Law was recodified in 1984 and the statutes renumbered. Mr. A indicated that it was his understanding that this Circular Letter is sent to insureds when an insurer terminates an agent for cause and is not sent when the termination is mutually agreed upon. However, this is incorrect. Mr. A was directed to follow the requirements and procedures found in said statute. He was also referred to N.Y. Ins. Law § 2112(d) (McKinney 2000) and N.Y. Comp. Codes R. & Regs. tit. 11, § 20.2 (2001) (Regulation 9) concerning notice of termination of appointment of insurance agents. The Departments web site may be accessed at www.ins.state.ny.us.
For further information you may contact Associate Attorney Jeffrey A. Stonehill at the New York City office.