New York Agents’ Group Declines to Join Lawsuit Against State over Pay Rules

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A schism is emerging between New York’s trade groups for insurance agents over how best to challenge rules requiring agents to reveal their pay.

The Professional Insurance Agents of New York (PIANY) says it will not join a planned lawsuit by the Independent Insurance Agents and Broker of New York (IIABNY) against state regulators over the new rules. President Kevin M. Ryan said that PIANY was invited to join the suit, but its board decided against that move.

“After much analysis and consideration we have concluded that joining in the legal action is not the right thing for us to do,” he said. Ryan said PIANY believes that any party suing the state over the regulations would not have a seat at the table to continue negotiations. Ryan also said that none of PIANY’s legal advisers was “overly optimistic the suit will prevail.”

The decision by PIANY not to join the lawsuit was “disappointing,” said IIABNY President Richard Poppa.

“It would be better for all producers in the state if we have a unified front on this,” he said. It “does not diminish the legal arguments, but we also don’t agree with the premise that we will automatically be excluded from future discussions.”

Poppa acknowledged the insurance department has said it “would be difficult” to work with any party that was suing the state over the regulations, but Poppa said he does not believe it would limit IIABNY’s ability to lobby the department about the rules.

“When all is said and done, I don’t think that they don’t want to exclude anybody from this,” Poppa said. IIABNY expects to file the lawsuit by June.

Andy Mais, spokesman for the New York State Insurance Department, agreed that any lawsuit against the department would make working relationships “extremely difficult,” adding that “this is a consumer protection measure and we would hope that the producer community would join us to implement it, as opposed to working through the courts to try to block it.”

Topics Lawsuits New York Agencies

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