New York Comprehensive Insurance Disclosure Act of 2022: significant changes to the CPLR – Insurance
United States: New York Comprehensive Insurance Disclosure Act of 2022: Important Amendments to the CPLR
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On December 31, 2021, New York State Governor Hochul enacted the Comprehensive Insurance Disclosure Act.
The act’s alleged rationale was to reduce the use of “delaying tactics” by requiring the disclosure of all of the primary, surplus and umbrella policies involved in the claim.
These changes will be unduly onerous for both carriers and defense lawyers for a multitude of reasons. It places an obligation on the insurer to immediately identify excess policies, eroded policies and other information or contracts that affect the available coverage.
Disclosure of comprehensive insurance policies
- Modified CPLR 3101 (f) (2) now requires defendants to provide claimants with competitive information for any insurance contract by which a judgment could be satisfied. within 60 days of service of a response.
- This includes all primary, excess and umbrella policies., and a complete copy of such policies, including statements, insurance agreements, conditions, exclusions, endorsements and similar provisions, such as a request for insurance.
- The defendants have a permanent obligation to ensure that the information remains accurate and complete, and
must provide updated information within 30 days of receiving the information that makes the prior disclosure inaccurate or incomplete.
– The obligation exists during the for the duration of the dispute and for 60 days after settlement or the entry of the final judgment in the case, including all appeals.
Erosion of insurance policies
Disclosure includes any legal action that has reduced or eroded, or may reduce or erode, the amounts available under a policy.
– Also demands the amount of attorneys’ fees that have eroded or reduced the face value of the policy, as well as the name and address of any attorney who received such payments.
Disclosure of contact information for complaints
Disclosure of contact details, including telephone number and email address, of any person (s) responsible for resolving the claim.
– Includes TPAs ââand the people within the insurance entity to whom the TPA is required to report.
Certification of information provided
The newly added article, CPLR 3122-b, requires that the information provided in accordance with subsection (f) of article 3101 be
certified by the defendant and his lawyer that the information is accurate and complete. This new article imposes an obligation upon receipt of the complaint.
Application to pending actions
- The text of the bill states that the law comes into force immediately and applies to all âpending actionsâ.
– Any information required by this law that has not been previously provided in pending cases must be provided within 60 days of the date the law comes into force
– The carrier must look back and comply with pending disputes
Obligations of the carrier
- Through March 1, 2022, the carrier must determine whether the requirements of CPLR 3101 (f) have been met and, if not, provide the relevant information to defense counsel.
- In the future with cases, the carrier must:
– At the start of a case, identify all the policies involved.
– At the start of a case, get copies of all the policies involved and identify any lawsuits that have reduced or eroded the policies.
– Continuously monitor the policies involved and immediately report any changes to defense counsel.
– Provide the name, telephone number and email address of claims adjusters (including TPAs).
– Provide up-to-date contact information throughout the dispute for policyholders.
– Notify the insured that his insurance request will be delivered to the plaintiff’s lawyer.
Obligations of the defense lawyer
- Through March 1, 2022, the defense lawyer should review all pending cases to determine what insurance information has already been disclosed and collect the missing information from the insurer (full copies of policies, contact details of the claims adjuster, etc. .)
Defense counsel must provide two certifications, one from the insured and one self-certification at the time of disclosure.
There is an ongoing obligation to ensure that the information disclosed remains accurate and complete throughout the litigation.
The implementation of this law raises many questions, including the effects of disclosure on the negotiation of a settlement with the plaintiff’s lawyer. There is no indication of the consequences that a party will suffer for non-compliance or for providing false information, even wrongly. The term âpending actionsâ is also not defined in the amended / new law, which is particularly relevant for actions settled with an application pending and actions stayed. We anticipate numerous disputes interpreting these new rules.
The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.
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