The National Association of Independent Insurers has issued a bulletin supporting a new Bill (S.B. 632), introduced by New York State Senators William J. Larkin (R, 39th district) and James L. Steward (R, 51st district), designed to reintroduce 7 percent flex rating and reestablish insurers authority not to renew up to 2 percent of their auto policies annually, commonly referred to as “extenders.”
A similar measure passed the Senate last year but failed to pass the Legislature. Gerald L. Zimmerman, senior counsel for the (NAII), said that the chances of passage in the Senate were therefore quite good, but warned that the Bill might have “a similar fate this year” in the Lower House. He indicated that “Unfortunately, the obstacle to getting this bill passed in 2003 will again be Assembly Insurance Chairman Pete Grannis.”
Last year, Grannis blocked adoption of the Senate extenders bill in large part because of his opposition to the 7 percent flex rating extender, which would permit insurers to adjust their rates up or down as needed within a seven percent parameter.
“Flex rating helps insurers to stay competitive and respond quickly to marketplace changes without having to file for approval with the state insurance department,” Zimmerman stated. “The system is beneficial for both insurers and consumers, and also spares the insurance department the time, cost and manpower of individually reviewing and approving small rate changes.”
“S.B. 632 is expected to be on the first Senate Insurance Committee agenda and referred to the full Senate for further consideration,” the bulletin concluded.
Topics New York
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