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The Office of General Counsel issued the following opinion on March 15, 2007 representing the position of the New York State Insurance Department.

Re: Dental Services to a Municipality

Questions Presented:

1. Does an agreement between a dentist and a municipality to provide dental services to the municipality’s employees constitute the “doing of an insurance business” for which a license is required pursuant to N.Y. Ins. Law § 1102 (McKinney 2006)?

2. Does an agreement between a dentist and a private business to provide dental services to the business’ employees constitute the “doing of an insurance business” for which a license is required pursuant to Insurance Law § 1102?


Without more information, the Department’s Office of General Counsel cannot answer the queries.


The inquirer reports that he represents a dentist who, for many years, has treated numerous employees of a municipality as patients. The municipality recently informed the dentist that it is changing its health care plans and will no longer offer dental insurance coverage to its employees. The municipality has inquired whether it may contract directly with the dentist to provide dental services to its employees.


Upon receipt of the written inquiry, the Office of General Counsel requested additional information from the inquirer to assist the attorney in fashioning a response. The inquirer spoke to the attorney on the phone, and the inquirer advised the Department that he did not wish to provide additional information. Given this circumstance, the Department is unable to answer the questions posed.

The Department generally refrains from responding to hypothetical inquiries without regard to facts, because responses to such questions may, among other things, prove erroneous when applied to a specific set of circumstances. However, the Department has opined about dental service plans. For instance, Opinion of General Counsel No. 01-06-10 (June 15, 2001) states that a service plan that, for a pre-paid fee, obligates one party to provide a benefit dependent upon a fortuitous event, constitutes “insurance” under Insurance Law § 1101 and requires a license pursuant to Insurance Law § 1102, unless the fee covered the cost of the rendition of services plus the cost of reasonable overhead expenses. If each separate fee charged by a dentist for services that are dependent upon a fortuitous event covers the cost of rendition to the dentist, including reasonable overhead, then such a program would not constitute the "doing of an insurance business" for which a license is required. Id.

For further information you may contact Senior Attorney Elizabeth Barrett at the New York City Office.

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