BILL NUMBER: S8585
SPONSOR: KAVANAGH
 
TITLE OF BILL:
An act to amend the insurance law, in relation to recovery for climate
disaster losses
 
PURPOSE OR GENERAL IDEA OF BILL:
To allow for private insurers, the New York Property Insurance Under-
writing Association (NYPIUA), and the New York State Attorney General to
seek damages from fossil fuel corporations in cases of climate-related
catastrophic incidents and disasters.
 
SUMMARY OF PROVISIONS:
Section one of the bill adds new section 3463 to the insurance law.
Subdivision (a) the new section 3463 establishes definitions for
"climate disaster," "fossil fuel product," and "responsible party."
Subdivision (b) of the new section 3463 permits the office of the Attor-
ney General to bring a civil action on behalf of the people of New York
against any responsible party to recover assessments imposed on member
insurers of NYPIUA, increased costs imposed on policyholders based on
project climate disasters, or costs resulting from disruptions to the
property/casualty insurance market arising from climate disasters. It
authorizes the Attorney General to recover climate attributable damage,
restitution, disgorgement, reasonable costs and disbursements incurred,
and other relief that a court or jury deem proper.
Subdivision (c) of the new section 3463 establishes that responsible
parties shall be strictly liable for any damages, restitution, or other
relief afforded under this section.
Subdivision (d) of the new section 3463 provides that, in any action
under this section, the court shall offset any restitution award by
amounts already reimbursed in claims arising from the same case or
controversy, and requires claimants seeking restitution to certify any
amounts received from an insurer or NYPIUA for the same loss.
Section two of the bill amends the insurance law by creating new section
4122.
Subdivision (a) of the new section 4122 permits NYPIUA and any insurer
doing business in the state who have suffered harm as a result of a
climate disaster to bring a civil action against a responsible party to
recover relief, and establishes a three-year statute of limitations from
the date the harm was discovered. It makes responsible parties strictly
liable for damages, restitution, or other relief, and provides that none
of the rights assigned may be waived.
Subdivision (b) of the new section 4122 provides that the existence of a
civil action against a responsible party is not an independent basis for
enforcement of any other law or for the denial, revocation, suspension,
or withholding of any right or privilege conferred by the state.
Subdivision (c) of the new section 4122 provides that nothing in this
section shall be construed to limit the enforceability of existing laws
in related areas, relieve liability of damages for climate change from
other laws, preempt any person from seeking damages related to climate
change, or limit a party's First Amendment rights.
Section three of the bill amends section 2304 of the insurance law to
require subrogation proceeds to be considered as factors in setting
insurance rates.
Section four of the bill provides for severability of the provisions in
the event any are found to be invalid.
Section five of the bill sets forth the effective date.
 
JUSTIFICATION:
Climate change has imposed extraordinary and escalating costs on New
York State, its residents and municipalities, and its insurance markets.
Severe flooding, heat waves, and convective storms are increasingly
expensive to recover from, and New York communities are facing mounting
damage while the state's Property Insurance Underwriting Association
(NYPIUA) and private insurers cover very large climate-related losses.
In 2012, Superstorm Sandy caused more than $25 billion in insured loss-
es, and in 2021, Hurricane Ida caused over $200 million in insured loss-
es. Increasingly frequent severe storms continue to strain the state's
insurance infrastructure.
These costs ultimately fall on taxpayers through costs associated with
emergency response, disaster relief, and infrastructure repairs, and
insurance policyholders through rising premiums. Advances in attribution
science now enable researchers to identify the contribution of climate
change to specific weather events. This bill would provide a path to
allow those who profited from products that they knew would contribute
to climate disasters to be held accountable for a proportionate share of
the resulting costs, rather than forcing New York's taxpayers and home-
owners to shoulder the full burden. It would establish frameworks for
the Attorney General and insurers to recover costs from parties respon-
sible.
This legislation would protect the stability of New York's insurance
market and reduce pressure on taxpayers and policyholders, promoting
both fairness and accountability in addressing the costs of climate
change.
 
PRIOR LEGISLATIVE HISTORY:
This is a new bill.
 
FISCAL IMPLICATIONS:
None to the state.
 
EFFECTIVE DATE:
This act shall take effect ninety days after it shall become a law.

Statutes affected:
S8585: 2304 insurance law, 2304(a) insurance law