New York State Insurance Department

      Until 1849, insurance companies doing business in New York State were chartered by special acts of the New York State Legislature.In 1849, the Legislature passed a law requiring prospective insurance companies to file incorporation papers with the New York Secretary of State.The law also vested regulatory power over insurance companies with the State Comptroller, who was authorized to require the companies to submit annual financial statements and to deny a company the right to operate if capital securities and investments did not remain secure.

In 1859, the New York State Legislature created the New York State Insurance Department, and assumed the functions of the Comptroller and Secretary of State relating to insurance.The Department began operations in 1860 and William F. Barnes was the first Superintendent of Insurance.The Home Life Insurance Company based in Brooklyn, New York was the first life insurer to be authorized by the newly formed New York State Insurance Department in 1860. Superintendent Barnes supervised the filings of 155 fire insurance companies and 16 life insurance companies during his first year in office.

By the 1870s, each state regulated insurance in some manner and most had an insurance department or agency.However, because different state requirements led to confusion in the insurance industry, New York State Superintendent George W. Miller, in 1871, invited the heads of insurance departments or agencies from other states to meet in New York to strive for more uniform regulation.Eighteen states met that year for the first session of what is now the National Association of Insurance Commissioners ("NAIC").

Mismanagement in the life insurance business, including exorbitant salaries and questionable investments, resulted in a 1905 investigation led by Charles Evans Hughes.The investigation, known as the "Armstrong Investigation", led to the passage of a law that set forth a series of reforms, including mandatory periodic examinations of all life insurers.

During the Great Depression, the Insurance Department promoted new rules clarifying insurer investment requirements, setting more equitable determination of cash surrender values and forfeitures, and recognizing up-to-date values and improvements in mortality tables.

After World War II, the Insurance Department pioneered many consumer protections, including comprehensive mandated health insurance benefits, open enrollment, and prohibitions against insurers arbitrarily dropping an individual’s health insurance coverage.

The New York State Insurance Department was the first insurance department or agency in the United States to establish a capital markets group to examine and measure the risks in insurer investment practices, and was the first state to recognize the importance of segregating multiple lines insurance from financial guaranty insurance as a means of preventing systemic risk.

In 2001, New York was the first state to establish an Insurance Emergency Operations Center ("IEOC"), which was designed to accelerate disaster assessments and expedite claims payments to disaster victims.The IEOC helped New Yorkers recover from the September 11, 2001 terrorist attacks.

During the financial crisis of 2008, the Insurance Department helped stabilize financial guaranty insurers and worked with federal regulators to ensure that AIG did not collapse when it experienced a liquidity crisis.

In 2011, Governor Andrew M. Cuomo and the New York State Legislature consolidated the New York State Insurance Department and the New York State Banking Department and created the New York State Department of Financial Services.James J. Wrynn was the fortieth and last Superintendent of Insurance.

Insurance policy

     In insurance, the insurance policy is a contract (generally a standard form contract) between the insurer and the insured, known as the policyholder, which determines the claims which the insurer is legally required to pay. In exchange for an initial payment, known as the premium, the insurer promises to pay for loss caused by perils covered under the policy language.

Insurance contracts are designed to meet specific needs and thus have many features not found in many other types of contracts. Since insurance policies are standard forms, they feature boilerplate language which is similar across a wide variety of different types of insurance policies.

The insurance policy is generally an integrated contract, meaning that it includes all forms associated with the agreement between the insured and insurer.:10 In some cases, however, supplementary writings such as letters sent after the final agreement can make the insurance policy a non-integrated contract.:11 One insurance textbook states that generally "courts consider all prior negotiations or agreements ... every contractual term in the policy at the time of delivery, as well as those written afterwards as policy riders and endorsements ... with both parties' consent, are part of written policy".The textbook also states that the policy must refer to all papers which are part of the policy. Oral agreements are subject to the parol evidence rule, and may not be considered part of the policy if the contract appears to be whole. Advertising materials and circulars are typically not part of a policy Oral contracts pending the issuance of a written policy can occur.

Early insurance contracts tended to be written on the basis of every single type of risk (where risks were defined extremely narrowly), and a separate premium was calculated and charged for each. This structure proved unsustainable in the context of the Second Industrial Revolution, in that a typical large conglomerate might have dozens of types of risks to insure against.

In the 1940s, the insurance industry shifted to the current system where covered risks are initially defined broadly in an insuring agreement on a general policy form (e.g., "We will pay all sums that the insured becomes legally obligated to pay as damages..."), then narrowed down by subsequent exclusion clauses (e.g., "This insurance does not apply to..."). If the insured desires coverage for a risk taken out by an exclusion on the standard form, the insured can sometimes pay an additional premium for an endorsement to the policy that overrides the exclusion.

Insurers have been criticized in some quarters for the development of complex policies with layers of interactions between coverage clauses, conditions, exclusions, and exceptions to exclusions. In a case interpreting one ancestor of the modern "products-completed operations hazard" clause, the Supreme Court of California complained:

In the United States, property and casualty insurers typically use similar or even identical language in their standard insurance policies, which are drafted by advisory organizations such as the Insurance Services Office and the American Association of Insurance Services.This reduces the regulatory burden for insurers as policy forms must be approved by states; it also allows consumers to more readily compare policies, albeit at the expense of consumer choice.In addition, as policy forms are reviewed by courts, the interpretations become more predictable as courts elaborate upon the interpretation of the same clauses in the same policy forms, rather than different policies from different insurers.

In recent years, however, insurers have increasingly modified the standard forms in company-specific ways or declined to adopt changes to standard forms. For example, a review of home insurance policies found substantial differences in various provisions.In some areas such as directors and officers liability insurance and personal umbrella insurance there is little industry-wide standardization.