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New York, March 12, 1999

Superintendent of Insurance Neil D. Levin today renewed the Department's commitment to New York policyholders in requiring the insurance industry to take appropriate Year 2000 (Y2K ) compliance measures. Levin, in response to a U.S. General Accounting Office (GAO) report criticizing the lack of regulatory effort of many state insurance regulators, is pleased that the New York State Insurance Department has been cited by federal regulators for leading the charge in its effort to ensure that all insurance companies doing business in the State have Y2K readiness plans.

"We have led the charge in our regulatory efforts," said Levin. "We have taken our obligation to New York policyholders very seriously and as a result have been proactively overseeing the insurance industry's Y2K compliance progress since mid 1997. We are proud to be recognized at the national level for our commitment and leadership."

In a letter written to the GAO regarding its report, Representative John D. Dingell (D-Michigan), a ranking member of the U.S. House of Representatives Committee on Commerce, states that New York has taken a strong and wide ranging approach in the Y2K compliance area. He commends the Department's surveys, quarterly reports and targeted exams that treat both New York domiciled companies and nondomiciled companies the same on this issue.

Highlights of the Department's Y2K compliance initiatives include:

  • Requiring insurers to have a written plan and budget to assure computer systems are Y2K compliant;
  • Requesting that all quarterly surveys to the Department be signed by a senior officer of the company providing an ongoing status of all Y2K initiatives. These quarterly status updates provide ongoing reports on all Y2K initiatives by addressing budgets, vendor status, contingency plans and communications to policyholders, shareholder and customers;
  • Performing on-site targeted Y2K examinations of the companies;
  • Requiring company CEOs to submit signed certifications to the Department once all systems are determined to be in compliance;
  • Convening a monthly internal Y2K task force to review industry status chaired by the Executive Bureau; and
  • Creating a Y2K section on its website

In addition to closely monitoring companies' Y2K compliance efforts and contingency plans, Levin is requiring insurance companies to make public their Y2K readiness plans to policyholders -- making this the first time that mutual insurers and other nonpublic companies will be disclosing this information to policyholders. The disclosures, which will be part of a supplement to the companies' annual financial statements, are due April 1.

"The public is concerned about the status of their insurer's Y2K readiness and have a right to know how they might be impacted by these plans, said Levin. " We have been making every effort to ensure policyholders can review this information."

Department of Financial Services


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