Empire State insurance regulators want to change the way group life insurers handle liability coverage issues for their agents and securities broker-dealer representatives.[@@]
Some mandatory group life producer liability insurance programs appear to be illegal, according to Jeffrey Angelo, chief of the New York State Insurance Department’s life bureau, and Mark Presser, chief of the department’s property bureau.
Insurers that are sponsoring or writing the problem group life producer liability programs should tell the New York department about the programs within 30 days and suggest plans for taking corrective action, Angelo and Presser write in Circular Letter Number 6 (2005).
If any property-casualty insurer has issued an illegal group life producer liability policy, “the insurer must restructure the program and make appropriate filings to be in compliance with the laws and regulations,” Angelo and Presser write. “Any illegal policy must be nonrenewed as of its next renewal date.”
The liability programs under attack require agents and broker-dealer reps to buy liability insurance coverage through a master policy issued to the life insurer by a specific property-casualty insurer, Angelo and Presser write.