Insurance Premiums Update

Wednesday, April 8, 2020

A recent Executive Order issued by Governor Cuomo, in conjunction with the New York State Department of Financial Services (DFS), extends grace periods for insurance premiums due and gives you other rights under certain insurance policies if you are an individual or small business (100 employees or less) and can demonstrate financial hardship as a result of the COVID-19 pandemic. These changes are currently in effect but are temporary.

Please check the DFS’s website for updates.

Generally, these extended grace periods apply to personal insurance policies like auto, homeowners, and renters insurance. So, if you are an individual and an “affected policyholder” (you are only an affected policyholder if you are experiencing financial hardship as a result of the COVID-19 pandemic), please contact your insurance carrier or Amsure to see how these temporary provisions may apply to you.

For small businesses, only certain types of commercial insurance policies are covered by these amendments. Generally, these extended grace periods and other associated changes include property, fire, commercial general liability, special multiperil, medical malpractice, workers’ compensation, commercial auto (including livery and other for-hire vehicles), and commercial umbrella insurance. A business qualifies as a “small business” if it is located in New York State, is independently owned and operated, and employs 100 or fewer individuals. If you are a small business and an affected policyholder (again, you are only an affected policyholder if you are experiencing financial hardship as a result of the COVID-19 pandemic), please contact your insurance carrier or Amsure to see how these temporary provisions may apply to you.

Here is a brief overview of the provisions:

Moratorium on Cancellation, Non-Renewal, and Conditional Renewal

If you are an affected policyholder, there is a moratorium on your insurer canceling, non-renewing, or conditionally renewing your property/casualty insurance policy for 60 days. If you do not make a timely premium payment and can demonstrate financial hardship as a result of the COVID-19 pandemic, your insurer may not impose any late fees relating to the premium payment or report you to a credit reporting agency or a debt collection agency regarding such premium payment.

Catching up on Overdue Insurance Payments

Ultimately, all premium payments must be paid; however, the regulations require your insurer to permit you, as an affected policyholder, to pay the overdue premium over 12 months. If you did not make a timely premium payment due to financial hardship as a result of the COVID-19 pandemic, you must still demonstrate financial hardship as a result of the COVID-19 pandemic. This also applies if the insurer sent you a nonpayment cancellation notice before March 29, 2020.

How to Demonstrate Financial Hardship

If you, as an affected policyholder, are unable to make a timely premium payment due to financial hardship as a result of the COVID-19 pandemic, you may submit to your insurance carrier, insurance agent, or premium finance agency, as applicable, a statement that you swear or affirm in writing under penalty of perjury that you are experiencing financial hardship as a result of the COVID-19 pandemic. This statement shall be accepted as satisfactory proof by your carrier, agent, or premium finance company. Such a statement is not required to be notarized.

Questions

If you have any questions regarding your rights under the Executive Order or regulations, please contact your insurance carrier or Amsure.

Finally, let me say thank you to all of our clients. We appreciate your business and will work with each one of you to assist however we can.

Be well,

Matthew D’Abate
President