Sec. 67.3. Waiver of the mandatory inspection requirement

(a) Mandatory waivers. An insurer shall waive an inspection of:

(1) a temporary substitute automobile; and

(2) an automobile that is leased for less than six months.

(b) Optional waivers. An insurer may waive an inspection:

(1) where an automobile is at least seven model years old on the effective date of automobile physical damage insurance;

(2) where a new, unused automobile is purchased, leased or transferred from a new automobile dealer;

(3) for an additional or replacement automobile, where the named insured has been continuously insured for automobile insurance with the same insurer or another insurer under common control or ownership for at least two years;

(4) where a nonowned automobile is insured under a policy providing automobile physical damage insurance issued by an insurer that has inspected the automobile in accordance with the provisions of this Part;

(5) for an automobile insured under a policy that provides automobile physical damage insurance for five or more automobiles;

(6) where a licensed insurance producer transfers a book of business from one insurer to another insurer or insurers, provided that the named insured elected to transfer coverage to the new insurer from the previous insurer and the previous insurer had inspected the insured automobile in accordance with the provisions of this Part;

(7) when a licensed independent insurance agent transfers an individual named insured's coverage to another insurer, provided that the licensed independent insurance agent represents both insurers, the insured automobile was physically inspected by the previous insurer in accordance with the provisions of this Part and the named insured elected to transfer coverage to the new insurer from the previous insurer;

(8) when one insurer has agreed to accept the majority of another insurer's book of automobile physical damage insurance business covering private passenger automobiles registered in New York State, provided that the named insured elected to transfer coverage to the new insurer from the previous insurer provided that the previous insurer had inspected the insured automobile in accordance with the provisions of this Part and supplies the new insurer with a copy of the inspection report that was completed on its behalf;

(9) where an insurer voluntarily writes a named insured's coverage in accordance with a program approved by the superintendent, which is designed to reduce the number of persons insured through the NYAIP, provided that the insurer assigned by the NYAIP physically inspected the insured automobile in accordance with the provisions of this Part and supplies the new insurer with a copy of the inspection report that was completed on its behalf and the coverage with the new insurer becomes effective immediately after the termination of coverage with the insurer assigned by the NYAIP;

(10) where an insurer has agreed to write a named insured's private passenger automobile physical damage insurance, which is otherwise terminating with another insurer under common control or ownership and where the terminating insurer inspected the insured automobile in accordance with the provisions of this Part; or

(11) under a new policy, where the named insured's automobile has been continuously insured for automobile physical damage insurance by the insurer issuing the new policy or any other insurer without a lapse in coverage provided that the insurer actually inspected the automobile within the previous two years in accordance with the provisions of this Part.

(c) An insurer shall set forth the procedures for implementing any inspection waiver required or permitted pursuant to this section in the insurer’s plan of operations. An insurer shall base the inspection waiver, and any exceptions to the waiver, on underwriting criteria uniformly applied.

(d)

(1) When an insurer waives an inspection pursuant to paragraph (a)(2) of this section, the insurer shall request that the named insured submit a copy of the lease agreement that sets forth a full description of the automobile at the time of lease or rental.

(2) When an insurer waives an inspection pursuant to paragraph (b)(2) of this section, the insurer shall request that the named insured submit:

(i) a copy of the window sticker or advanced dealer shipping notice (invoice) showing the total retail price of the insured automobile including an itemized list of all factory and dealer installed options, accessories and equipment installed on or within the automobile at the time of sale, lease or transfer; and

(ii) a copy of the:

(a) bill of sale or lease agreement that sets forth a full description of the automobile, including all factory and dealer installed options, accessories and equipment installed on or within the automobile at the time of sale, lease or transfer; or

(b) MV-50 form provided by the New York State Department of Motor Vehicles, which establishes transfer of ownership from the new automobile dealer to the named insured.

(3) When an insurer waives an inspection pursuant to paragraph (a)(2) or (b)(2) of this section, the insurer shall:

(i) condition payment of any physical damage loss upon the insurer’s receipt of the relevant documents set forth in paragraph (1) or (2) of this subdivision;

(ii) not suspend coverage during the initial annual policy term due to the named insured's failure to provide the required documents; and

(iii) require an inspection of the insured automobile as a condition of renewal of the private passenger automobile physical damage insurance, pursuant to the provisions of section 67.7(c) of this Part, if the insurer cannot obtain a copy of the documents required by paragraph (1) or (2) of this subdivision at least 60 calendar days prior to the first annual renewal date.

(4)

(i) An insurer shall not waive an inspection pursuant to paragraph (b)(4), (6), (7), (8), (9), (10) or (11) of this section unless the previous insurer’s authorized representative actually inspected the named insured’s automobile.

(ii) When an insurer waives an inspection pursuant to paragraph (b)(4), (6), (7), (8), (9), (10), or (11) of this section, the insurer shall:

(a) document the insurer’s reason to believe that the automobile was inspected by the previous insurer in accordance with this Part, as well as the source of that information;

(b) request, within 10 days of the start of coverage, confirmation that the inspection was completed and applicable photographs were taken, and a copy of the completed inspection report and applicable photographs from the previous insurer, insurance agent, third-party such as the photo inspection vendor or insured, unless the insurer already has in its possession a copy of the inspection report and applicable photographs;

(c) not suspend coverage during the term of the initial annual policy period due to the previous insurer’s failure to provide a copy of the previously completed inspection report and applicable photographs; and

(d) require an inspection of the insured automobile as a condition of renewal of private passenger automobile physical damage insurance pursuant to the provisions of section 67.7(c) of this Part, if the insurer does not obtain a copy of the inspection report and applicable photographs from the previous insurer at least 60 calendar days prior to the first annual renewal date.