The Professional Insurance Agents of New York (PIANY) said the New York Insurance Department approved the disclosure language earlier this week. PIANY says the language was developed during a series of meetings with regulators over the last month.
The approval means that agents who use the PIANY-drafted language would comply fully with the primary-disclosure requirements of the regulations, which are scheduled to go into effect on Jan. 1.
“PIA continues to object to the regulation, but we are pleased that our ongoing discussions with the (department) have already garnered clear guidance… on critical compliance issues,” said PIANY President Kevin M. Ryan. “This is just the first part of the compliance guidance that we will be providing members over the next few months.”
The statement satisfies the primary disclosure component of the regulation, PIANY said, and would be presented to policyholders — orally or in writing — at or prior to the time of application for an insurance contract. If the information is provided orally, however, it must also be provided in writing no later than the issuance of the insurance policy.
PIANY says it will continue reviewing additional compliance guidance by the department, particularly secondary-disclosure requirements of the regulation. Among the issues PIANY says still to be addressed: disclosure requirements for nonresident producers; the approval of use of averages and percentages to describe compensation; when compensation is based upon a sale; clarification of who is a producer in a transaction; and minimizing paperwork and record retention requirements.
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