David A. Paterson
James J. Wrynn
The Office of General Counsel issued the following opinion on June 3, 2010, representing the position of the New York State Insurance Department.
Re: Deductibles for automobile physical damage insurance policies
1) May an authorized insurer offer a zero deductible for a policy of comprehensive or collision automobile insurance coverage?
2) Is there an exception to the deductible requirements for antique, special, or historical vehicle programs, since these are not standard automobile programs?
1) No. N.Y. Ins. Law
2) No, there is no exception to the deductible requirements for antique, special, or historical vehicle programs.
The inquiry is of a general nature, without reference to particular facts.
1) Deductibles under private passenger motor vehicle insurance policies
The inquirer asks, on behalf of an insurer who is a customer of the inquirer, about whether an insurer may offer automobile physical damage insurance with a zero deductible for automobiles registered in New York.
Section 3411(k) reads, in pertinent part, as follows:
Each insurer which offers physical damage insurance subject to the provisions of this section shall offer such insurance with a standard deductible of two hundred dollars for each occurrence. The insured shall, however, at the inception of the policy or at the annual anniversary date, or at the time of the replacement or addition of an automobile, have the option of purchasing a policy with a lesser deductible, but in no event may the insurer sell a policy with a deductible of less than fifty dollars for fire, theft or comprehensive insurance coverages (one hundred dollars for assigned risk policies. . .) and one hundred dollars for collision insurance coverage except that window glass coverage may be sold without a deductible. . . .
A zero deductible on either comprehensive or collision insurance coverage is not permissible under automobile physical damage insurance policies covering New York State registered private passenger automobiles under Ins. Law
2) Deductibles under antique, special, or historical private passenger motor vehicle insurance policies
The inquirer also asks whether there is an exception for antique, special, or historical vehicles to the limitations on deductibles set forth in Ins. Law
For further information you may contact Associate Attorney Jeffrey A. Stonehill at the New York City Office.