NU Online News Service, Dec. 8, 3:52 p.m. EDT
Producer compensation remains at the top of the legislative agenda for two major New York independent insurance agent associations in 2011.
The Independent Insurance Agents & Brokers of New York (IIABNY) released its legislative position paper today, outlining the issues of importance to producers and the public.
"These are vital issues, not just for New York independent insurance agents and brokers, but for New York businesses and families," David M. Gelia, IIABNY chairman of the board, said in a statement.
The Professional Insurance Agents of New York (PIANY) will publish its final legislative position paper for 2011 soon on some issues it has been working on for years, said Matthew Guiltbault, director of government and legislative affairs, but outlined some of the association's legislative priorities for next year. Their paper will be posted on the association's website.
The one issue front and center for the two associations is producer compensation disclosure. Both associations said they disagree with the plan laid out by the State Insurance Department. The regulations require producers to advise clients of their compensation from insurers, whether it is asked for or not, and to keep records of the advisement.
Mr. Guiltbault said the association will dutifully watch for the introduction of any legislation on this issue and advise the department of difficulties producers are having with the legislation, urging changes or revisions where needed.
IIABNY reiterated its opposition to Insurance Regulation 194 that takes effect the first of the year. The association, along with the Council of Insurance Brokers of Greater New York, sued the department over the regulation, but it was rejected by the trial court. The association said it is still considering an appeal.
Coastal homeowners hurricane deductibles will be a major issue for both associations as they urge the legislature to set a single, standard trigger for all insurers. The current practice allows insurers to set their own deductible trigger on the worth of the home, which can range from 1-5 percent. IIABNY said it is opposed to new restrictions on companies' ability to non-renew policies in coastal areas.
Auto no-fault reform is also on the agenda. Mr. Guiltbault said fraud is up again and the legislature needs to address the issue, finding solutions while saving the program.
IIABNY laid out what it believes legislators need to do, including:
o Companies need more time to investigate claims that they believe are fraudulent.
o Require mandatory arbitration of claims.
o Implement medical treatment guidelines.
o Permit assignment of benefits only when there is no dispute over coverage.
o Introduce new burden-of-proof requirements.
o Enact new penalties for medical providers guilty of fraud.
Both associations plan to take aim at protecting agents and brokers who receive bad checks from their clients. Currently, Mr. Guiltbault explained, if a check is bounced, the insurance agent must pursue payment but can't cancel the policy. This is because the policy is paid by the agent to the company through the agency's fiduciary fund. In other states, a bounced check is considered non-payment and the policy cancelled until paid.
IIABNY and PIANY both want to see new restrictions on the ability of businesses and government entities to modify certificates of insurance.
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