Insurers are required to delay collecting premium on life insurance and annuity contracts written in New York for 90 days under an emergency regulation adopted today.
The directive covers consumers experiencing financial hardship due to the COVID-19 pandemic, the New York Department of Financial Services said in a news release.
Consumers and small businesses experiencing hardship may defer paying premiums for property and casualty insurance for 60 days. Premium finance agencies are required to provide the same relief as insurers.
“Government and industry must continue to work together to help those who are suffering financially due to the COVID-19 pandemic,” said DFS Superintendent Linda A. Lacewell. “We are taking action to give New Yorkers experiencing financial hardship during this difficult period extra time to pay their insurance premiums and make other policy-related decisions.”
In addition, DFS announced that uninsured New Yorkers can obtain health insurance through New York State’s Health Plan Marketplace under a special enrollment period from April 1-15.
Industry On Board
The 134 members of the Life Insurance Council of New York (LICONY), which represent over 80% of the life insurance industry in New York, agreed to extend to 90 days the grace period for the payment of premiums and fees, and for the exercise of policyholder or certificate holder rights, under life insurance policies and annuity contracts in cases of financial hardship due to the COVID-19 pandemic.
The emergency regulation adopted by DFS ensures a level playing field by directing all regulated issuers of life insurance and annuity contracts in the state to give the same relief, the release said.
“The members of LICONY are deeply concerned about the impact of the current economic conditions on their customers,” said LICONY President and CEO Mary A. Griffin. “Our members are proud of our partnership with Governor Cuomo and Superintendent Lacewell during these challenging times and we stand ready to assist our customers by providing a 90-day grace period for premium payments to anyone encountering financial hardship as a result of COVID-19.”
DFS requires life insurance and annuity contract issuers to provide the following relief to policyholder or certificate holder (consumer) who can demonstrate financial hardship due to COVID-19:
• Extend to 90 days the grace period for the payment of premiums and fees to ensure that the policyholder’s or certificate holder’s life insurance policy or certificate does not lapse for non-payment during the 90-day period;
• Waive late payment fees otherwise due, and not report late payments to credit rating agencies, during the 90-day period;
• Allow premiums due but not paid during the 90-day period to be paid over the course of the following year in 12 equal monthly installments; and
• Extend to 90 days the period to exercise policyholder and contract holder rights and benefits under life insurance and annuity contracts.
Property And Casualty Insurance
The emergency regulation also directs P&C insurers to provide flexibility to consumers experiencing financial hardship caused by the pandemic by extending to 60 days the grace period for the payment of premiums and fees under auto, homeowners and renters insurance policies, among others.
The same relief will be available for businesses with 100 employees or less, independently owned and operated and resident in New York, under auto, homeowners, renters, workers’ compensation, medical malpractice, livery and taxi, and certain other lines of commercial insurance.
DFS requires P&C insurers to provide the following relief to consumers and small businesses who can demonstrate financial hardship due to COVID-19:
• Provide a 60-day grace period for the cancellation, conditional renewal or non-renewal of a policyholder’s insurance policy;
• Allow premiums due but not paid during the 60-day period to be paid over the course of the following year in 12 equal monthly installments; and
• Waive any late payment fees, and not report late payments to credit rating agencies, during the 60-day period.
Premium Finance Agencies
The emergency regulation also requires premium finance agencies to provide the same relief to those consumers and businesses who have financed the payments of their premiums, subject to safety and soundness considerations of the premium finance agencies.
DFS requires premium finance agencies to provide the following relief to consumers and businesses who can demonstrate financial hardship due to COVID-19:
• Provide a 90-day grace period (for life insurance policies) and a 60-day grace period (for property and casualty policies) for the payment of installment payments under the premium financing agreement;
• Allow installment payments due but not paid during the applicable grace period to be paid over the course of the following year in 12 equal monthly installments; and
• Waive any late payment fees, and not report late payments to credit rating agencies, during the applicable grace period.
Health Insurance Special Enrollment Period
DFS also announced that uninsured individuals will be able to obtain health insurance coverage through the NY State of Health, New York’s Health Plan Marketplace, under a special enrollment period from April 1-15. To date, 2,244 New Yorkers have already applied.
New Yorkers who have lost their jobs due to the pandemic may enroll in the marketplace at any time within 60 days from their loss of coverage, or may be eligible to enroll in other NY State of Health programs – Medicaid, low-premium Essential Plan and Child Health Plus.
New Yorkers can apply for coverage through NY State of Health online at nystateofhealth.ny.gov, by phone at 855-355-5777, or with the help of enrollment assistors.
The emergency regulation can be found at Part 119 of Title 3 of the Official Compilation of Codes, Rules and Regulations of the State of New York. Read a copy of the emergency regulation.