BILL NUMBER: S8259
SPONSOR: SKOUFIS
 
TITLE OF BILL:
An act to amend the insurance law, in relation to orders of conservation
for domestic insurers
 
PURPOSE:
Extends provisions of the insurance law to provide the Department of
Financial Services with the authority to conserve assets of domestic
insurers.
 
SUMMARY OF PROVISIONS:
Section 1. Amends section 7406 of the insurance law to extend the
department of financial service's authority to conserve assets to apply
to domestic insurers and clarifies certain parts of the provision as
they relate to foreign insurers.
Section 2. Amends section 7407 of the insurance law to provide that
where the superintendent has been appointed as conservator of the assets
of a domestic insurer, they must conduct an analysis of the business and
financial condition of the insurer and may take action as deemed neces-
sary to restore the insurer to private management and normal operations.
Section 3. Effective Date.
 
JUSTIFICATION:
This bill authorizes the Department of Financial Services (DFS) to place
domestic insurance companies facing the possibility of insolvency into
conservation, a power DFS is currently restricted in use only for
foreign insurers. Conservation allows DFS to install temporary manage-
ment to assess the financial condition of an insurer and take appropri-
ate steps to protect its assets before rehabilitation or liquidation
becomes necessary. Extending this authority to domestic insurers gives
DFS a practical way to intervene earlier in cases of financial distress,
helping to protect policyholders and maintain stability in the insurance
market.
 
LEGISLATIVE HISTORY:
New bill
 
FISCAL IMPLICATIONS:
TBD
 
EFFECTIVE DATE:,
This act shall take effect immediately and shall apply to all appoint-
ments pursuant to the provisions of sections 7406 of the insurance law
which occur on and after such date.

Statutes affected:
S8259: 7407 insurance law