N.Y. Insurance Law § 5504: Policies

§ 5504. Policies. (a) No policy form shall be used by the association

unless it has been filed with the superintendent and either he has

approved it, or thirty days have elapsed and he has not disapproved it

as misleading or violative of public policy.

(b) (1) Except as provided in paragraph two of this subsection, no

cancellation notice or nonrenewal notice shall be effective unless the

association at least forty-five days prior to the effective date of such

cancellation or the end of the policy period, as the case may be, mails

or delivers such notice to the insured at the address shown on the

policy and to such insured's licensed representative.

(2) Where the cancellation is for nonpayment of premium or loss of

license to practice or, if the insured is a hospital, it no longer

possesses a valid operating certificate under section twenty-eight

hundred one-a of the public health law, such cancellation notice must be

mailed or delivered at least fifteen days prior to the effective date of

the cancellation.

(3) Upon written request by an insured or such insured's licensed

representative, the association shall mail or deliver loss information

as provided in subsection (g) of section three thousand four hundred

twenty-six of this chapter to such insured or such insured's licensed

representative within ten business days of such request.

(4) All cancellation notices or nonrenewal notices shall state the

grounds upon which the policy is cancelled or nonrenewed and that, upon

written request of an insured or such insured's licensed representative,

the association will furnish the facts on which the cancellation or

nonrenewal is based. Grounds for nonrenewal shall be limited to the same

grounds as for cancellation. All cancellation notices or nonrenewal

notices shall also provide or be accompanied by a statement advising the

insured of the availability of the loss information specified in

subsection (g) of section three thousand four hundred twenty-six of this

chapter.

(c) A policy of insurance issued by the association may be terminated

other than for non-payment of premiums if the insured:

(1) Is not complying substantially with any term or condition of such

contract.

(2) Has knowingly made, or caused to be made, any false statement or

misrepresentation of a material fact for use in applying for insurance.

(3) Has failed to pay to the association all stabilization reserve

fund charges.

(d) Any termination shall apply to care or services provided after the

effective date of termination, except that insurance coverage may

continue for up to thirty days after termination with respect to care or

services to patients which are a continuation of a treatment begun prior

to the effective date of termination.

(e) Policies issued by the association shall provide at the insured's

option for deductibles and for co-insurance. An applicant electing an

option for a deductible or for co-insurance shall have the right to

purchase an option under which the association shall not settle any

claim under the policy without the consent of the insured. Any policy

issued by the association without a deductible or co-insurance shall

provide that the association shall have the sole authority to settle any

claim up to policy limits without the consent of the insured.

(f) (1) The association shall issue or renew policies of medical

malpractice insurance for physicians on a claims-made or occurrence

basis, as prescribed by the superintendent by regulation.

(2) A claims-made policy shall contain the following provisions:

(A) if the insured has purchased a claims-made policy from an admitted

insurer or the association for a period of five or more consecutive

years and the insured, after attaining the age of sixty-five or older,

retires permanently and totally from the practice of medicine or if the

insured has purchased a claims-made policy for a period of ten or more

consecutive years and the insured, after attaining the age of fifty-five

or older, retires permanently and totally from the practice of medicine,

the association shall, without charging an additional premium therefor

at the time of, or subsequent to, such retirement, also cover all

occurrences between the inception date of the first such consecutive

policy from such association and such retirement date which, subsequent

to the termination date, are reported in accordance with statutory and

policy requirements;

(B) if the insured dies or becomes permanently disabled and unable to

practice medicine while covered by such policy the association shall,

without charging an additional premium therefor at the time of, or

subsequent to, such event, also cover all occurrences between the

inception date of the first such consecutive policy from such

association and the death or disability of the insured, and

(C) the association shall make available and shall advise the insured

of the availability and cost of coverage for occurrences between the

inception date of the first such consecutive policy from such

association and the termination of such policy which, subsequent to the

termination date, are reported in accordance with statutory and policy

requirements, pursuant to such terms and conditions as may be specified

by the superintendent by regulation. The insured shall have the option

of purchasing such coverage either in a single payment or in three

annual installments with an additional finance charge.

(3) Such regulation shall also provide that if the coverage of an

insured who continues to practice in this state is transferred from an

admitted insurer or the association to another admitted insurer or the

association without any gap in coverage, the former entity shall pay

over to the successor an actuarially appropriate dollar amount to

provide for the requirements of paragraph two of this subsection, and

the insured shall be entitled to the benefits of this provision as if

such insured had been continuously covered by the successor entity

during the entire period of consecutive years of coverage.

(4) Such regulation shall also provide that if the coverage of an

insured is transferred from the association, if the association is in

liquidation, to an admitted insurer not in liquidation without any gap

in coverage, then the successor entity shall accept the amounts payable

from the property-casualty insurance security fund as provided in

subparagraph (G) of paragraph one of subsection (a) of section seven

thousand six hundred three of this chapter, to provide for the

requirements of paragraphs two and three of this subsection, and the

insured shall be entitled to the benefits of such paragraphs as if such

insured had been continuously covered by the successor entity during the

entire period of consecutive years of coverage.

(5) The association may issue a claims-made policy with more liberal

policy provisions than are required in this subsection, subject to the

approval of the superintendent. Such liberal policy provisions may

include but shall not be limited to a provision which, for all of the

policyholders of the association, grants credits toward the cost of

coverage provided in paragraph two of this subsection in proportion to

the number of years the insured has purchased a claims-made policy.