Assessment of Public Comments for the Third Amendment to 11 NYCRR 16 (Insurance Regulation 86)
The purpose of the proposed amendment is to amend Part 16 (Regulation 86), which implements Insurance Law Article 63, governing special risk insurance, to carry out Chapter 490 of the Laws of 2011, which amended Article 63. Chapter 490 exempted insurers from certain rate and policy form approval requirements with respect to policies issued to “large commercial insureds”. Section 6304 requires the Superintendent to promulgate rules and regulations implementing the provisions of Article 63 by establishing methods, procedures and reports for licensing and for facilitating, monitoring and verifying compliance with Article 63.
The rule establishes a new Class 3 with respect to large commercial insureds. Chapter 490 requires the insurer to submit a certificate of insurance to the Superintendent with respect to each Class 3 policy. The rule fleshes out this requirement and requires the insurer to submit along with the certificate of insurance a form that includes additional information such as the identity of the insured and the risk manager utilized by the “large commercial insured” (certification form). The Department received several comments from property/casualty insurance trade associations during the public comment period objecting to this provision.
Although the filing of the certification is not mandated by the statute, it is necessary in order for the Department to properly monitor the new Class 3 business submissions. The alternative of not requiring the certification form to be submitted with the certificate of insurance was considered and rejected because the form will expedite the review of the filings, enhance compliance with the statute and rule and enable the Department to more easily monitor the types of Class 3 risks that insurers are writing.
The Department also received a number of comments regarding other aspects of Regulation 86. Since none of the provisions commented on were necessary to implement Chapter 490, the Department did not include them in the emergency rule. Thus, they are not being included in the permanent adoption of the rule, but rather will be addressed in a separate amendment to the regulation.
Therefore, the rule is being adopted as proposed.