COVID-19 Response: NYDFS Issues Call for Special Report on Interrupted Business Coverage from All Authorized Commercial Property & Casualty Insurers
New York, N.Y. (March 12, 2020) - New York's Department of Financial Services (DFS) issued a letter on March 10, 2020, titled "Call for Special Report Pursuant to Section 308, New York Insurance Law: Business Interruption and Related Coverage Written in New York."
This letter instructs each authorized property/casualty insurer to provide certain information regarding the commercial property insurance it has written in New York and details on the business interruption coverage provided in the types of policies for which it has ongoing exposure.
It is noted that “each Insurer should provide the DFS the volume of business interruption coverage, civil authority coverage, contingent business interruption coverage and supply chain coverage the Insurer wrote that has not lapsed as of the date of this letter, which should be expresses in amounts of direct premium, policy types and numbers of policies written of each type.” In this regard, this request appears similar to the NYSDF’s requests and orders following Superstorm Sandy in 2012, which the New Jersey Department of Banking & Insurance soon followed.
The letter further references that “each Insurer should examine policies it has issued and explain the coverage each policy offers with regard to COVID-19 -both presently and as the situation could develop to change policyholder’s status (i.e., is there any potential for coverage as a result of COVID-19?)."
Further, that for each policy type, insurers should prepare and send an explanation “to each policyholders of the applicable policy types” and send copies to the NYSDFS. The details as to what “information” is to be included in the “explanation to policyholders” is set forth in the letter. This “information” to be included essentially requires an insurer to issue a coverage position letter to an insured.
The letter notes that “all responses” should be sent “on or before March 18, 2020.”
For more information on this NYDFS letter, contact the author of this alert. Lewis Brisbois has formed a COVID-19 Attorney Response Team to help your business with the myriad legal issues arising from the outbreak. Visit our COVID-19 Response Resource Center for additional alerts on this topic.
Seth I. Weinstein, Partner
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