BILL NUMBER: S5051
SPONSOR: BAILEY
 
TITLE OF BILL:
An act to amend the insurance law, in relation to paintless dent repair
rate filing
 
PURPOSE:
This bill amends the Insurance Law by removing the requirement to fil
Certain rates with the NY Department of Financial Services ("DFS") in
order to increase competition among providers and lower prices for
consumers.
 
SUMMARY OF PROVISIONS:
Section 1 of the bill amends paragraph (a) of Insurance Law S 7903 by
removing the rate filing requirement for service contract providers
selling paintless dent repair and/or windshield repair services.
 
EXISTING LAW:
The DFS has interpreted Insurance Law S 7903(a) to require service
contract providers to file with it the exact rates charged for paintless
dent repair and windshield repair contracts.
 
LEGISLATIVE HISTORY:
2023-24: S2799 - Referred to Insurance
2021-22: S9099 - Referred to Insurance
 
STATEMENT IN SUPPORT:
Traditional insurance companies are often required to file rates with
regulators. However, service contracts are exempt from typical insurance
regulation and therefore, service providers are also typically exempt
from these rate filing requirements. (New York exempts service contracts
from the Insurance Law, save for Article 79 which specifically addresses
such contracts.)
The DFS currently requires service contract providers selling paintless
dent repair or windshield repair service contracts to file the rates
charged for these products. Service contract providers are further
required to notify the DFS at least thirty days before implementing any
rate change. These requirements pin service contract providers to a
specific rate, often forcing them to file higher rates in anticipation
of potential, though yet unsubstantiated market changes. Further the
DFS's interpretation of the current law (as requiring providers to file
the exact rate to be charged, rather than the maximum rate to be
charged) stifles consumers, preventing them from negotiating a lower
rate with the provider at the time of sale. This bill removes the oner-
ous rate filing requirements, empowering consumers to negotiate lower
rates when purchasing paintless dent repair or windshield repair
protection. It also allows providers to adjust their rates to more
closely match current market conditions, alleviating the need for
providers to overestimate costs and promoting lower rates and cost
savings for consumers.
 
BUDGET IMPLICATIONS:
None.
 
EFFECTIVE DATE:
Immediately.

Statutes affected:
S5051: 7903 insurance law, 7903(a) insurance law