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Out-Of-State Plans Told: Don't Give Your Number

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If an insurer that is not authorized to do business in New York sells a group plan that happens to cover New York residents, it can communicate with those insureds only through mail and electronic mail.

Officials in the Office of General Counsel at the New York Department of Insurance have come to that conclusion in an opinion recently posted on the department website.

Officials say the group plan insurers cannot call the insureds, provide telephone numbers in mailed communications, or communicate with the insureds through any type of Internet technology other than e-mail.

Insurers that are not authorized to do business in New York normally cannot do any business in the state, officials write in the opinion. But the state insurance law does establish a “mail order” exception for some group life, group accident and health, and blanket accident and health plans.

The exception may apply if an insurer authorized in another jurisdiction sells a master policy or a master contract to a customer in that jurisdiction.

When a group plan qualifies for the mail order exception, “then an insurer may transact business by mail to the New York members of such groups,” officials write.

“The mail order exception only applies to contact occurring through the mail, including electronic mail,” officials write. “The exception, however, does not apply to other activity on the [Internet], including [Internet] conference calls.”

Similarly, an unauthorized insurer may not send “its telephone number to its customers for purposes of engaging in telephone conversations, even if the communications are customer-initiated and devoid of any intended acts of solicitation by the insurer,” officials write.