In the March/April 2010 edition of the NY State Bar News, NY’s new Power of Attorney form is discussed as it was the topic of the Trusts And Estates Law Section Annual Meeting.
The new form went into effect on September 1, 2009 and according to Brandon J. Vogel, author of the State Bar News article “what once was a straightforward legal tool became a well-intentioned, but overcomplicated form at the expense of the general public.” While a discussion of the details of the new law are well-beyond the scope of this posting and insurance compliance generally, one aspect that is particularly important to note is that third parties, such as financial institutions, now must accept a validly executed form.
No longer will insurers be permitted to require the use of their own form. While I have received some questions on whether language on application forms triggers the requirements of the new law, the import is actually the opposite. Insurer’s in house forms cannot substitute for the 9-page, 12-point type form with mandatory notices. Both principal and agent must sign and be notarized.
It is also important for insurers to note that the new form has an automatic revocation feature when a new form is executed. If an insurer’s customer executes a new PoA under the law, any previously executed form is automatically revoked, including any form on file with the insurer. Panelists at the Bar Association meeting recommend a revision to the law to reduce the possibility of inadvertent revocations, but as of now that provision stands.
Also discussed in the Bar News was the possibility that the complexity of the new PoA forms could lead to more guardianship proceedings, which could have impact for insurers as well, due to the complexity of the form and the reluctance of some to wade through the 9 pages. Of course, without a guardian or a properly executed new form PoA, dealings must be with the principal.