By: Scott Hobson, Legislative Analyst
On May 2nd, Assemblywoman Helene Weinstein (D, Brooklyn) introduced Assembly Bill A.10045, which would create a private right of action for “unfair insurance claim settlement practices.” Currently, actions for such violations may only be pursued by the Superintendent of the New York Department of Financial Services.
The bill gives the broad powers of the DFS Superintendent to private attorneys but fails to incorporate any safeguards against abuse or mechanism of accountability. Moreover, the definition of “unfair claim settlement practices” relies on broad, subjective language which could be easily exploited by plaintiffs’ attorneys. The legislation also provides for the award of punitive damages and attorneys’ fees. LRANY strongly opposes this legislation because it would invite a surge of meritless lawsuits against insurance companies, ultimately impacting New York consumers and businesses through higher premium costs.