Two New York agents’ groups said they have taken the first steps to appeal a decision by state court judge allowing state insurance regulators to force brokers to reveal their commissions.
The Independent Insurance Agents and Brokers of New York (IIABNY) and the Council of Insurance Brokers of Greater New York said they have filed a notice of appeal with the New York Supreme Court Appellate Division in Albany yesterday.
“Our action today preserves our right to make a formal appeal at a future date,” said IIABNY Chair of the Board David M. Gelia. “We will spend the next several months building the strongest possible case we can make to the appellate court.”
At issue is a regulation set to go into effect Jan. 1, which requires insurance agents in the state to reveal to their clients the nature, source and amount of commissions they receive for selling insurance products.
If asked to do so, agents will also have to provide written documentation describing in detail how much hey get paid for a particular transaction.
Agents had fought the regulation, arguing that it violated their rights and impose significant compliance costs. The legal challenge in the case centered on whether the state’s insurance commissioner had the legal authority to implement the role.
State regulators and consumer advocates countered that the disclosure was in the public’s interest and that the New York Insurance Department had the authority to compel agents and brokers to reveal the information.
Last month, Supreme Court Justice Richard M. Platkin sided with state regulators and upheld their right to require the disclosure.
State law gives a party 30 days from the entry of a court decision to file a notice of appeal. IIABNY and CIBGNY took today’s action in order to meet the legal deadline. However, the groups say it could be months before they submit their arguments to the appellate court.
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