The New York Insurance Department, after more than a year of consideration and a hearing, formally proposed a regulation expanding the list of difficult risks that can be insured by other than New York- licensed carriers this month.

Publication of the new rule, which can be modified after public comment, has the support of the Independent Insurance Agents & Brokers of New York, which has been pushing for a regulatory change.

The rule would amend what is known as the "export list"–categories of insurance classes and coverages which an excess line broker may place with an unlicensed insurance company without first having them rejected by three New York State- licensed insurers.

Currently New York law allows the Insurance Department to exempt coverages from this requirement "upon findings and conclusions" based on "relevant market conditions."

IIABNY said it has worked closely with the Excess Line Association of New York and other trade groups to lobby for an expansion of the export list to include several coverages and classifications "for which licensed insurers have little appetite."

At the department's hearing on the issue last June. IIABNY board chairs Neal L. Sullivan and Sharon Emek and IIABNY Director of Research and External Communications Tim Dodge testified in support of the expansion.

The proposed rule would exempt brokers from having to show prior rejections for a number of coverages, including liability coverage for most types of construction contractors, property coverage for very high-value buildings, professional liability coverage for institutions such as alcohol and drug rehabilitation centers and hospices, and liability coverage for special events such as trade shows, fairs and concerts.

"The Insurance Department's action will make doing business easier for New York insurance brokers while still protecting insurance buyers," said IIABNY Chairman Lane S. Rubin. "The accounts that will go to the excess line market after expansion of the export list are the same ones that go there now. Expansion will free the broker from an administrative exercise that does not produce value for the client, and it will give the broker the time to do a better job for the client."

Mr. Dodge said among the risks already on the export list are items such as rodeos, amusement parks and flood insurance for losses in excess of National Flood Insurance Program limits.

The rules change is listed on the department Web site as proposed Eleventh Amendment to Regulation 41 11 NYCRR 27 Excess Line Placements Governing Standards.

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NY Proposes New Rule For E&S Export List Expansion

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