Significant attention has been given in the media to the New York Assembly’s recent passage of several bills, apparently motivated by Storm Sandy, that would impact property insurance claim handling and litigation. None of these bills have been passed by the state senate yet, or signed by the governor. Some of them have been inaccurately described in some media reports.  Here is a quick summary of some key provisions (I have not included everything contained in these bills, only what jumped out at me):

  • Anti-Concurrent Causation Clauses: Bill 7455-A would not, contrary to some media reports, outlaw anti-concurrent causation clauses in New York (something that only California and North Dakota have done by statute). This bill would, however, specify that where there is both excluded flood damage and covered damage (such as wind damage), the insurer would pay for the covered portion of the damage and not for the excluded flood damage. The bill would also require additional specificity in causation-related provisions in an insurance policy, and require that disclosure of these provisions be provided to the policyholder prior to purchase of the policy. How these policy provisions would be written raises some potentially difficult questions because there are all kinds of circumstances that can involve one cause leading to another cause, and capturing these in policy language (as the bill appears to require) could create some challenges. The bill states that it would take effect immediately and apply to all policies issued or renewed thereafter (it is unclear how this would play out where insurers cannot, as a practical matter, change their policy language immediately). Bill 7452-A also relates to causation, and would prohibit certain denials of business interruption claims in certain circumstances as set forth therein (this one is difficult to summarize briefly). This bill states that it would take effect immediately and apply to all policies issued or renewed thereafter.
  • New Bad Faith Statutory Claim: Bill 5780 would create a private right of action for violation of N.Y. Ins. Law § 2601, an unfair claim settlement practice statute which does not currently provide for a private right of action.  This would apply only to claims arising from certain disasters (declared as such by the governor). Remedies potentially available would include actual damages, punitive damages for “willfully and knowingly” violating the statute, and reasonable attorneys’ fees to a prevailing plaintiff.  This bill states that it would take effect immediately.
  • Expediting Insurance Claim Litigation: Bill 5570 would provide, with respect to certain insurance litigation in New York state courts arising out of disasters, among other things, that: (1) mandatory early settlement conferences must be held; (2) discovery must be completed within 60 days; and (3) all pretrial motions must be made within 30 days of the notice of issue. This bill states that it would take effect immediately.
  • Timeframes for Claim Decisions:  Bill 1092A would require, with respect to disaster-related claims (as defined therein) that “an insurer shall, within fifteen business days of receipt of all items, statements and forms requested [in accordance with regulations promulgated by the Department of Financial Services] from the claimant . . . advise the claimant in writing whether the insurer has accepted or rejected the claim.”  The insurer could grant itself one extension of 15 business days by notifying the insured in writing with an explanation of why additional time is needed.  This bill states that it would take effect immediately.

It will be interesting to see which, if any, of these bills become law, and if they are amended along the way.  Stay tuned.

Tags: Anti-Concurrent Causation Clauses, Expediting Insurance Claim Litigation, New Bad Faith Statutory Claim, new york assembly, Timeframes for Claim Decisions
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Photo of Wystan Ackerman Wystan Ackerman

I am a partner at the law firm of Robinson+Cole in Hartford, Connecticut, USA.  My contact information is on the contact page of my blog.  I really enjoy receiving questions, comments, suggestions and even criticism from readers.  So please e-mail me if you…

I am a partner at the law firm of Robinson+Cole in Hartford, Connecticut, USA.  My contact information is on the contact page of my blog.  I really enjoy receiving questions, comments, suggestions and even criticism from readers.  So please e-mail me if you have something to say.  For those looking for my detailed law firm bio, click here.  If you want a more light-hearted and hopefully more interesting summary, read on:

People often ask about my unusual first name, Wystan.  It’s pronounced WISS-ten.  It’s not Winston.  There is no “n” in the middle.  It comes from my father’s favorite poet, W.H. (Wystan Hugh) Auden.  I’ve grown to like the fact that because my name is unusual people tend to remember it better, even if they don’t pronounce it right (and there is no need for anyone to use my last name because I’m always the only Wystan).

I grew up in Deep River, Connecticut, a small town on the west side of the Connecticut River in the south central part of the state.  I’ve always had strong interests in history, politics and baseball.  My heroes growing up were Abraham Lincoln and Wade Boggs (at that time the third baseman for the Boston Red Sox).  I think it was my early fascination with Lincoln that drove me to practice law.  I went to high school at The Williams School in New London, Connecticut, where I edited the school newspaper, played baseball, and was primarily responsible for the installation of a flag pole near the school entrance (it seemed like every other school had one but until my class raised the money and bought one at my urging, Williams had no flag pole).  As a high school senior, my interest in history and politics led me to score high enough on a test of those subjects to be chosen as one of Connecticut’s two delegates to the U.S. Senate Youth Program, which further solidified my interest in law and government.  One of my mentors at Williams was of the view that there were far too many lawyers and I should find something more useful to do, but if I really had to be a lawyer there was always room for one more.  I eventually decided to be that “one more.”  I went on to Bowdoin College, where I wrote for the Bowdoin Orient and majored in government, but took a lot of math classes because I found college math interesting and challenging.  I then went to Columbia Law School, where I was lucky enough to be selected as one of the minions who spent their time fastidiously cite-checking and Blue booking hundred-plus-page articles in the Columbia Law Review.  I also interned in the chambers of then-Judge Sonia Sotomayor when she was a relatively new judge on the Second Circuit, my only connection to someone who now has one-ninth of the last word on what constitutes the law of our land.  I graduated from Columbia in 2001, then worked at Skadden Arps in Boston before returning to Connecticut and joining Robinson+Cole, one of the largest Connecticut-based law firms.  At the end of 2008, I was elected a partner at Robinson+Cole.

I’ve worked on class actions since the start of my career.  Being in the insurance capital of Hartford, we have a national insurance litigation practice and most of the class actions I’ve defended have been brought against insurance companies. I’ve also handled some involving products liability, managed care, health care, utilities, financial services, higher education and environmental issues.

My insurance class action practice usually takes me outside of Connecticut.  I’ve had the pleasure of working on cases in various federal and state courts and collaborating with great lawyers across the country.  While class actions are an increasingly large part of my practice, I don’t do exclusively class action work.  The rest of my practice involves litigating insurance coverage cases, often at the appellate level.  That also frequently takes me outside of Connecticut.  A highlight of my career thus far was working on Standard Fire Ins. Co. v. Knowles, the U.S. Supreme Court’s first Class Action Fairness Act case.  I was Counsel of Record for Standard Fire on the cert petition, and had the pleasure of working with Ted Boutrous on the merits briefing and oral argument.

I started this blog because writing is one of my favorite things to do and I enjoy following developments in class action law, writing about them and engaging in discussion with others who have an in interest in this area.  It’s a welcome break from day-to-day practice, keeps me current, broadens my network and results in some new business.

When I’m not at work, you might find me running lines or watching a musical with my teenage daughter who hopes to be a Broadway star (or taking her to voice or dance lessons) or reading a good book.

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