NU Online News Service, March 5, 11:10 a.m. EST
New York State is moving towards giving insurance agents and brokers the ability to use Internet banks for premium trust accounts.
The Independent Insurance Agents & Brokers of New York Inc. said they had asked for a rule to permit the use of Internet banks. The New York State Insurance Department recently sent the group a draft proposal amending N.Y. Insurance Regulation 29, which regulates premium trust accounts.
The draft regulation, IIABNY said, aims at allowing insurance producers to open premium accounts at Internet-based banks. Under current rules, New York's insurance producers can deposit fiduciary funds from premiums they collect only in banks with a physical presence in the state.
"IIABNY has worked and will continue to work with the State Insurance Department to help modernize New York's insurance industry and allow independent agents and brokers to take advantage of the technologies that promote efficiency," IIABNY Legislative Representative Michael Barrett said.
"This draft regulation is an important step in that direction, and we appreciate the department's willingness to move ahead on this issue," commented Mr. Barrett
The draft also establishes new provisions that define the Insurance Department and other state regulatory bodies' jurisdiction over the use of Internet-based banks.
IIABNY said it will continue to work with the state insurance department and other industry groups to make the regulation final.
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