§ 2618 — Standards for prompt investigation and settlement of claims

§ 2618. Standards for prompt investigation and settlement of claims.\n(a) (1) For the purpose of this section, "natural disaster" means the\noccurrence of widespread catastrophic or severe damage, injury, or loss\nof life or property resulting from any natural cause, including fire,\nflood, earthquake, hurricane, tornado, high water, landslide, mudslide,\nwind, storm, wave action, and ice storm.\n (2) This section shall apply to every insurer who writes policies that\ncover loss of or damage to real property, personal property or other\nliabilities for loss of, damage to, or injury to persons or property\nwhen:\n (A) a local state of emergency is declared pursuant to section\ntwenty-four of the executive law, when the governor declares a disaster\nemergency pursuant to section twenty-eight of the executive law, or when\nthe President issues a major disaster or emergency declaration pursuant\nto the Robert T. Stafford Disaster Relief and Emergency Assistance Act\n(P.L. 93-288);\n (B) the disaster is a natural disaster or a disaster caused by an act\nof terrorism; and\n (C) the claims are a result of such disaster.\n (3) An insurer shall acknowledge the receipt of all claims in writing\nto the claimant or the claimant's authorized representative in\naccordance with regulations promulgated by the superintendent;\n (4) If the insurer wishes its investigation to include an inspection\nof damaged or destroyed property, the inspection, whether performed by\nthe insurer, an independent adjuster, or other representative of the\ninsurer, shall occur in accordance with regulations promulgated by the\nsuperintendent. Furthermore, where necessary to protect health and\nsafety, immediate repairs to windows, exterior walls, exterior doors,\nroofs, heating systems, water systems and electrical systems may be made\nand alternative proof of loss such as photographs, video recordings,\ninventories and all receipts for repairs or replacement property shall\nsatisfy policy requirements;\n (5) A claim filed with an agent of an insurer shall be deemed to have\nbeen filed with the insurer unless, consistent with law or contract, the\nagent notifies the person filing the claim that the agent is not\nauthorized to receive notices of claim; and\n (6) An insurer shall furnish to such claimant, or the claimant's\nauthorized representative, a notification of all items, statements and\nforms, if any, which the insurer reasonably believes will be required of\nthe claimant in order to investigate such claim in accordance with\nregulations promulgated by the superintendent.\n (b)(1) An insurer shall, within fifteen business days of receipt of a\nproperly executed proof of loss and receipt of all items, statements and\nforms requested under this section from the claimant, or the claimant's\nauthorized representative, advise the claimant in writing whether the\ninsurer has accepted or rejected the non-commercial claim. When the\ninsurer suspects that the non-commercial claim involves arson, the\nforegoing fifteen business days shall be read as thirty business days.\n (2) An insurer shall be granted a one-time extension of fifteen\nbusiness days to determine whether a non-commercial claim should be\naccepted or rejected. If the insurer elects to utilize this extension,\nit shall so notify the claimant, or the claimant's authorized\nrepresentative, in writing. Such notification shall include the reasons\nadditional time is needed for the investigation.\n (3) (i) If the insurer needs more time to determine whether the\nnon-commercial claim should be accepted or rejected because the insurer\nis prohibited from accessing the property to investigate the claim, the\ninsurer shall be granted one additional extension of fifteen business\ndays. If the insurer elects to utilize this extension, it shall so\nnotify the claimant, or the claimant's authorized representative, in\nwriting, setting forth the reasons additional time is needed for the\ninvestigation.\n (ii) If the insurer needs more time to be able to physically access\nthe property because the insurer is prohibited from accessing it, the\ninsurer shall so notify the claimant, or the claimant's authorized\nrepresentative, every fifteen business days, in writing, setting forth\nthe reasons additional time is needed for the investigation. When the\ninsurer is no longer prohibited from accessing the property, and the\nproperty can be accessed, the insurer shall have no more than fifteen\ndays to adjudicate the claim.\n (c) (1) An insurer shall, within fifteen business days of receipt of a\nproperly executed proof of loss and receipt of all items, statements and\nforms requested under this section from the claimant, or the claimant's\nauthorized representative, advise the claimant in writing whether the\ninsurer has accepted or rejected the commercial claim.\n (2) An insurer shall be granted a one-time extension of thirty\nbusiness days to determine whether a commercial claim should be accepted\nor rejected. If the insurer elects to utilize this extension, it shall\nso notify the claimant, or the claimant's authorized representative, in\nwriting, setting forth the reasons additional time is needed for the\ninvestigation.\n (3) If succeeding the one-time extension of thirty business days the\ninsurer needs more time to determine whether the commercial claim should\nbe accepted or rejected, the insurer shall so notify the claimant, or\nthe claimant's authorized representative, every thirty business days, in\nwriting, setting forth the reasons additional time is needed for the\ninvestigation.\n (4) Once the claim is accepted by the insurer, the insurer shall\nadvise the claimant, or the claimant's authorized representative, in\nwriting of the amount the insurer is offering to settle the claim. The\ninsurer shall also provide to the claimant, or the claimant's authorized\nrepresentative, in writing, of all applicable policy provisions\nregarding the claimant's right to reject the offer and request an\nappraisal.\n (5) In any case where the claim is rejected by the insurer, the\ninsurer shall notify the claimant, or the claimant's authorized\nrepresentative, in writing, of all applicable policy provisions and\ndeadlines by which a claimant may sue the insurer. Any notice rejecting\nany element of a claim involving personal property insurance shall\ncontain the identity and the claims processing address of the insurer,\nthe insured's policy number, the claim number, and information regarding\nhow to file a complaint with the department in accordance with\nregulations promulgated by the superintendent.\n (d) Every insurer shall pay any amount finally agreed upon in\nsettlement of all or part of any claim not later than four business days\nfrom the receipt of such agreement by the insurer, or from the date of\nthe performance by the claimant of any condition set by such agreement,\nwhichever is later, except as provided in section three hundred\nthirty-one of this chapter with respect to liens by tax districts on\nfire insurance proceeds.\n (e) The superintendent may promulgate any rules or regulations\nnecessary to implement the provisions of this section.\n