A trade group for New York insurance agents says it will sue the state over newly issued rules that would force agents to reveal to clients how much they are paid.
The Independent Insurance Agents and Brokers of New York (IIABNY) issued a statement this afternoon saying that it would proceed with a lawsuit to stop the New York Insurance Department from implementing the regulation.
The department issued its final version of the regulation this afternoon. The rule is set to go into effect on Jan. 1, 2011.
IIABNY had previously threatened to sue the state if the group’s recommendations to make the rules less burdensome on agents were not included in the final rules.
In a statement, the group said “the rule would place an undue burden upon its members for no justifiable reason.” The group also said it will challenge the legal authority for the department to issue and enforce the regulation.
IIABNY President and CEO Dick Poppa said, “IIABNY has a responsibility to represent and to protect the interests of its members, and our members have unanimously and vociferously told us that this rule is unnecessary, ineffective and overly burdensome to their businesses. We cannot sit back idly and let the department impose an unnecessary rule that will only serve to add another time-consuming and costly requirement for our members, which in turn could also result in additional costs to consumers.”
The group says it has not formally filed the lawsuit.