On December 31, 2021, Governor Hochul signed into law the Comprehensive Insurance Disclosure Act which amends and significantly expands New York CPLR 3101(f). The law became effective immediately and therefore requires compliance by March 1, 2022 for all active civil cases.
CPLR 3101(f) previously permitted any party to seek insurance agreements which may be liable to satisfy a judgment. The newly enacted law now requires, without being served a demand, a number of mandatory disclosures placing additional burdens upon insurance carriers, defense attorneys, brokers and defendants to ensure compliance. Within sixty days of filing an Answer, a defendant or third-party defendant must now provide the contents of any “insurance agreement” that may be liable to satisfy a judgment, indemnify or reimburse any adverse party. Specifically, the new statute requires disclosing the following items and part of the “insurance agreement”:
- Full and complete copies of any primary, excess and umbrella insurance policies;
- The contact information including telephone number and email address of the applicable claims representative and third party administrator (if applicable);
- The amounts available under said insurance policies;
- The caption, filing date, and contact information for all attorneys involved in any lawsuits that have eroded or may erode the amounts available under the policies;
- The amount of attorney’s fees that have eroded the amount available under the policies and the name and address of the attorney who received such payments; and
- All applications for such insurance policies.
Defendants have an ongoing obligation to ensure that the information disclosed remains accurate and complete and provide updated information to their adversary within thirty days of receiving information that would render the prior disclosure inaccurate or incomplete. That obligation extends to sixty days following any settlement or final judgement.
CPLR 3101(f) clarifies that the aforementioned disclosures remain inadmissible at trial.
The legislature also enacted CPLR 3122-b, which requires that the mandatory insurance disclosures be accompanied by a certification signed by the defendant and a certification signed by the defendant’s attorney sworn in the form of affidavit or affirmation stating that the information is accurate and complete and that reasonable efforts have been taken and will be taken to ensure continued accuracy and completeness.
Since the enactment, there has been a wave of opposition and displeasure voiced by the defense bar as several of these new requirements have been perceived as unduly burdensome. The following amendments have been proposed to the legislature:
- Disclosure shall only apply to lawsuits filed after December 31, 2021;
- Extend the time for disclosure from sixty to ninety days;
- Disclosure of the claims representative’s contact information shall be limited to name and email address;
- Third party administrators need not disclose who they are reporting to;
- Eliminate the requirement of disclosing lawsuits that may erode the policy;
- Eliminate the requirement of disclosing attorney’s fees that have been paid out;
- Rather than an ongoing obligation to update disclosures within thirty days of new information, reasonable efforts shall be made to ensure accuracy when the note of issue is filed, entering into court supervised settlement negotiations, attending mediation or at the time of trial;
- Insurance applications need not be disclosed; and
- PIP lawsuits would be excluded from the requirements.
The senate passed a bill approving the amendments on January 26, 2022. That bill is now before the assembly for review. We anticipate a decision in the near future.
