Life Bureau Chief Michael E. Maffei recently announced that the New York State Insurance Department intends to begin to implement sanctions for the most serious violations on certified filings. The sanction he specifically referred to was suspension in the right to use the certified process.
Noting that these are extremely fact-specific, he was not able to give a lot of information about what the Department considers “most serious.” He did say, however, that they are looking at “knowing” violations as falling within this category. Mr. Maffei indicated that they have a variety of means for determining what was knowing and what wasn’t, including looking at previous filings.
A question was posed to Mr. Maffei about what type of sanctions and anticipated and he responded that they haven’t made any final decisions, but they are looking at a 90-day suspension. When asked, he also indicated that the suspension would be company-wide, even from companies that have multiple filing units and the violation was limited to a single unit.
Given the time frames that were reported in an earlier post and the experiences many have had with post-approval reviews, it seems likely that this development will lead some companies to reconsider prior approval as their preferred filing mode. Of course, if more companies start to go that route, it is likely those average times will get longer.