PURSUANT TO THE PROVISIONS OF THE State Administrative Procedure Act, NOTICE is hereby given of the following proposed rule:
Proposed Action:
This is a consensus rule making to amend Subpart 62-2 of Title 11 NYCRR.
Statutory authority:
Financial Services Law, sections 202 and 302; and Insurance Law, sections 201, 301, 318, 319, 403, 2601, 3403, 3413 and 3432
Subject:
Reports to Central Organization.
Purpose:
To replace outdated references to "PILR" with "central organization."
Text of proposed rule:
Section 62-2.2 is amended as follows:
(a) [The central organization is hereby designated to be the Property Insurance Loss Register, as administered by the American Insurance Association, hereinafter referred to as PILR.] In order to comply with this Subpart, [all insurers] every insurer licensed to write fire insurance in this State [are] is hereby required to become a subscriber[s] to [PILR] the central organization designated by the superintendent and shall be bound by all of the terms and conditions of subscribership [to PILR] thereto.
(b) Reporting and follow-up requirements. Insurers shall report all fire losses in excess of $1,000 involving applicable property, except losses to vehicles registered for use on public highways, to [PILR] the central organization within five business days following receipt of notice of loss. If the insurer has not received a response from [PILR] the central organization within 15 calendar days following its submission of the fire loss report [to PILR], the insurer shall continue to complete the adjustment of the loss.
(c) Verification procedures required prior to paying a fire claim. An insurer shall comply with the [PILR] central organization reporting procedures prior to [its payment of] paying a fire claim, subject to the rules provided for in this Subpart.
(1) The insurer shall not complete adjustment of the loss until expiration of 15 calendar days from the date of the submission of the fire loss report to [PILR] the central organization.
(2) If the [PILR] central organization’s response indicates insurance coverage by more than one insurer or of a previous fire loss, the insurers shall promptly investigate and resolve such circumstance [and/or] or confirm information related to prior losses.
(3) Subject to the provisions of section 62-1.2 of this Part, if the [insurer suspects from the PILR] central organization report or other information indicates to the insurer that the fire claim may be fraudulent, the insurer shall suspend processing of the claim pursuant to the provisions of Insurance Law section 2601 [of the Insurance Law].
Section 62-2.4 is amended as follows:
In accordance with the provisions of Insurance Law section 318 [of the Insurance Law], information reported to [PILR] the central organization pursuant to this Subpart shall be made available to law enforcement agencies, tax districts [which] that have, pursuant to the provisions of section 22 of the General Municipal Law, filed with the superintendent a notice of intention to claim against the proceeds of a policy of fire insurance, and governmental agencies charged with the responsibility of demolition of structures. [Requests for fire insurance loss information shall be submitted to the Insurance Frauds Bureau. The Insurance Frauds Bureau shall transmit all such requests to PILR for processing. PILR shall furnish all available information compiled from reports required to be made by this Subpart, to the Insurance Frauds Bureau, which in turn will make such information available to the requesting agency.]
Text of proposed rule and any required statements and analyses may be obtained from:
Jessica Heegan, NYS Department of Financial Services, One State Street, New York, NY 10004, (212) 480-5683, email: jessica.heegan@dfs.ny.gov
Data, views or arguments may be submitted to:
Same as above.
Public comment will be received until:
45 days after publication of this notice.
Consensus Rule Making Determination
The present rule requires insurers to report fire losses in excess of $1,000 to a central reporting organization, denominated the Property Insurance Loss Register (“PILR”), as administered by the American Insurance Association (“AIA”). However, since 1997, the actual central reporting organization has been the Insurance Services Office, Inc. (”ISO”), which acquired the PILR database of property claims as part of its acquisition of the American Insurance Services Group, Inc. (“AISG”) from AIA in that year. In 1998, ISO also acquired claims databases from National Insurance Crime Bureau (“NICB”). ISO created a single database (“ISO ClaimSearch®”) that merged the former NICB and AISG databases for multiple purposes: claims administration, fraud detection and prevention, compliance reporting, and assistance with law enforcement efforts, which has been in use for the past 15 years.
This amendment replaces outdated references to “PILR” with “central organization.” This change corrects the rule by removing outdated information, and provides the Superintendent greater flexibility to name a new central organization, if that becomes necessary, without having to make additional revisions to the rule.
This amendment also removes instructions that are no longer operative by removing the last three sentences of section 62-2.4, which currently provides that law enforcement agencies, and certain tax districts and governmental agencies, must make their requests for fire insurance loss information from the Department’s Criminal Investigations Unit, which would transmit such requests to PILR for processing. PILR would then have to furnish all available information compiled from reports required to be made by Subpart 62-2 to the Criminal Investigations Unit, which in turn would make such information available to the requesting agency. Actually, a requesting agency may obtain fire insurance loss information directly from ISO.
Because the amendment merely updates the rule by removing obsolete references and instructions, no person or entity is likely to object.
Accordingly, this rulemaking is determined to be a consensus rulemaking, as defined in State Administrative Procedure Act (“SAPA”) § 102(11), and is proposed pursuant to SAPA § 202(1)(b)(i). Therefore, this rulemaking is exempt from the requirement to file a Regulatory Impact Statement, Regulatory Flexibility Analysis for Small Businesses and Local Governments, or a Rural Area Flexibility Analysis.
Job Impact Statement
This amendment merely updates the rule by removing obsolete references and instructions. Amendment of the rule will not adversely impact job or employment opportunities in New York, or have any adverse impact on self-employment opportunities, because the revision imposes no new or additional requirements on any insurer subject to the rule.
