New York requires opt-in for supplemental spousal liability coverage

New York has passed a new law requiring most policyholders to opt in if they wish to include supplemental spousal liability (SSL) coverage in their automobile insurance policies.

Under the updated law, SSL coverage will automatically be included for first-named insureds who indicate they have a spouse unless they decline it. This adjustment aims to streamline the process for those with spouses, while others must actively choose to add the coverage.

As per AM Best, the law addresses concerns raised by 2023 legislation, which required policyholders to opt out of SSL coverage, even if they did not have a spouse.

The Professional Insurance Agents of New York State Inc. (PIANY), which supported the legislative update, said the previous change had caused confusion among policyholders.

Richard Andrews, president of PIANY, said the recent changes simplify the process and reduce confusion, ensuring that SSL coverage is appropriately offered to New York policyholders.

“The confusion surrounding supplemental spousal liability coverage in New York state, which began last year, has now been addressed,” Andrews said. “This legislative update simplifies the process, reduces confusion and ensures that SSL coverage is clearly and appropriately offered to policyholders in the state.”

The 2023 law was originally supported by proponents who argued that it helped prevent policyholders from unknowingly waiving SSL coverage by requiring them to opt out.

Elsewhere in the automobile space, the Rhode Island Department of Insurance has recently issued a reminder to insurers regarding the state’s restrictions on using certain aspects of a vehicle’s history when determining premiums for private passenger auto policies.

According to the regulator, premiums cannot be adjusted based on losses that are not considered chargeable accidents or moving violations.

State law defines an accident as non-chargeable for several reasons, including if the incident occurred more than three years ago, if the insured was 50% or less at fault, or if the vehicle was legally parked and unattended at the time of the accident.

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