On May 13, 2020, the New York Department of Financial Services ("DFS") issued a letter pursuant to Section 308 of the New York Insurance Law (the "Section 308 Letter") requiring all authorized property and casualty insurers to provide certain information regarding commercial liability insurance coverages written by such insurers in New York and exclusions or conditions to coverage provided in such types of policies with ongoing exposure in New York. Under Section 308 of the New York Insurance Law, the DFS has broad authority to demand special reports from authorized insurers (among other licensees) for any inquiry in relation to such party's transactions or condition or related matters.
The Section 308 Letter asked authorized property and casualty insurers to provide the following types of information:
- Explanation of the existence of communicable disease or similar exclusions in the insurer's commercial liability insurance and other policies that might be relied upon to deny coverage for claims alleging negligence or other wrongdoing in connection with COVID-19;
- Explanation of any COVID-19-related exclusions added or planned to be added to the insurer's policies in New York including in-force, renewal or new policies;
- Explanation of any decision or plan to stop offering products or make new product filings in New York "in any way due to COVID-19-related risks or existing adverse economic conditions"; and
- List of types of current policies for which "the pricing included recognition for potential coverage exposure for COVID-19-like losses".
Responses to the Section 308 Letter were due on or before May 21, 2020. The Section 308 Letter follows data calls and other requests for information from other regulators, including the National Association of Insurance Commissioners ("NAIC") and a previous data call related to business interruption insurance issued by the DFS as discussed here and here. As discussed here, New York chose not to participate in the NAIC's recent data call regarding business interruption coverages.
Originally published May 20, 2020
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