NY Ins L § 2601 (2021)
2021 New York Laws ISC - Insurance Article 26 - Unfair Claim Settlement Practices; Other Misconduct; Discrimination 2601 - Unfair Claim Settlement Practices; Penalties.

§  2601.  Unfair claim settlement practices; penalties. (a) No insurer doing business in this state shall engage  in  unfair  claim  settlement practices. Any of the following acts by an insurer, if committed without just  cause  and  performed with such frequency as to indicate a general business practice, shall constitute unfair claim settlement practices:  (1) knowingly misrepresenting to claimants pertinent facts  or  policy provisions relating to coverages at issue;  (2)  failing  to  acknowledge  with  reasonable  promptness  pertinent communications as to claims arising under its policies;  (3) failing to adopt and implement reasonable standards for the prompt investigation of claims arising under its policies;  (4) not attempting in  good  faith  to  effectuate  prompt,  fair  and equitable  settlements of claims submitted in which liability has become reasonably clear, except where there is a reasonable basis supported  by specific  information  available  for  review by the department that the claimant has caused the loss  to  occur  by  arson.  After  receiving  a properly  executed  proof of loss, the insurer shall advise the claimant of acceptance or denial of the claim within thirty working days;  (5) compelling policyholders to institute suits to recover amounts due under its policies by  offering  substantially  less  than  the  amounts ultimately recovered in suits brought by them;  (6)  failing  to promptly disclose coverage pursuant to subsection (d) or subparagraph (A) of paragraph two of subsection (f) of section  three thousand four hundred twenty of this chapter;  (7)  submitting  reasonably rendered claims to the independent dispute resolution process  established  under  article  six  of  the  financial services law; or  (8)  artificially  deflating  or otherwise lowering cost data used for adjusted claims, or using cost data that  is  not  appropriate  for  the region  of  the state where the loss occurred; this shall include but is not limited to claims adjusted by a person  issued  a  temporary  permit pursuant  to subsection (n) of section two thousand one hundred eight of this chapter.  (b) Evidence as to numbers and types of complaints to  the  department against  an insurer and as to the department's complaint experience with other insurers writing similar lines of insurance shall be admissible in evidence in any administrative or judicial proceeding under this section or article twenty-four or seventy-four of this chapter, but  no  insurer shall  be  deemed  in  violation of this section solely by reason of the numbers and types of such complaints.  (c) If it is found, after notice and an opportunity to be heard,  that an  insurer  has  violated  this section, each instance of noncompliance with subsection (a) hereof may be treated as  a  separate  violation  of this  section  for  purposes  of ordering a monetary penalty pursuant to subsection (b) of section one hundred nine of this chapter. A  violation of this section shall not be a misdemeanor.