NY Ins L § 3420 (2021)
2021 New York Laws ISC - Insurance Article 34 - Insurance Contracts-Property/casualty 3420 - Liability Insurance; Standard Provisions; Right of Injured Person.

§  3420.  Liability  insurance;  standard provisions; right of injured person. (a) No policy or contract insuring against liability for  injury to  person,  except  as  provided  in subsection (g) of this section, or against liability for injury to, or destruction of,  property  shall  be issued  or  delivered in this state, unless it contains in substance the following provisions or provisions that are equally or more favorable to the insured and to judgment creditors so far as such  provisions  relate to judgment creditors:  (1)  A  provision  that  the  insolvency  or  bankruptcy of the person insured, or the insolvency of the insured's estate,  shall  not  release the  insurer  from  the  payment of damages for injury sustained or loss occasioned during the life of and within the coverage of such policy  or contract.  (2)  A  provision  that  in  case  judgment against the insured or the insured's personal  representative  in  an  action  brought  to  recover damages  for  injury  sustained  or loss or damage occasioned during the life  of  the  policy  or  contract  shall  remain  unsatisfied  at  the expiration  of  thirty  days  from  the  serving  of  notice of entry of judgment upon the attorney for the insured, or  upon  the  insured,  and upon  the  insurer,  then an action may, except during a stay or limited stay of execution against the insured on such  judgment,  be  maintained against  the  insurer  under the terms of the policy or contract for the amount of such judgment not exceeding the amount of the applicable limit of coverage under such policy or contract.  (3) A provision that notice given by or on behalf of the  insured,  or written  notice  by  or  on  behalf  of  the injured person or any other claimant, to any licensed agent of  the  insurer  in  this  state,  with particulars  sufficient  to identify the insured, shall be deemed notice to the insurer.  (4) A provision that failure to give any notice required to  be  given by  such  policy within the time prescribed therein shall not invalidate any claim made by the insured, an injured person or any  other  claimant if  it  shall be shown not to have been reasonably possible to give such notice within the prescribed time and that notice was given as  soon  as was reasonably possible thereafter.  (5)  A  provision that failure to give any notice required to be given by such policy within the time prescribed therein shall  not  invalidate any  claim  made  by  the insured, injured person or any other claimant, unless the failure to provide timely notice has prejudiced the  insurer, except as provided in paragraph four of this subsection. With respect to a  claims-made  policy,  however,  the policy may provide that the claim shall be made during the policy period,  any  renewal  thereof,  or  any extended  reporting period, except as provided in paragraph four of this subsection. As used in this paragraph, the  terms  "claims-made  policy" and  "extended reporting period" shall have their respective meanings as provided in a regulation promulgated by the superintendent.  (6) A provision that, with respect to a claim arising out of death  or personal  injury  of  any  person, if the insurer disclaims liability or denies coverage based upon the failure to provide  timely  notice,  then the  injured  person  or  other claimant may maintain an action directly against such insurer, in  which  the  sole  question  is  the  insurer's disclaimer  or  denial  based  on  the failure to provide timely notice, unless within sixty  days  following  such  disclaimer  or  denial,  the insured or the insurer: (A) initiates an action to declare the rights of the parties under the insurance policy; and (B) names the injured person or other claimant as a party to the action.  (b)  Subject  to  the  limitations  and conditions of paragraph two of subsection (a) of this section, an  action  may  be  maintained  by  the  following  persons  against  the  insurer upon any policy or contract of liability insurance that is governed by such paragraph, to  recover  the amount of a judgment against the insured or his personal representative:  (1)  any person who, or the personal representative of any person who, has obtained a judgment against the insured or  the  insured's  personal representative,  for  damages  for  injury  sustained  or loss or damage occasioned during the life of the policy or contract;  (2) any person who, or the personal representative of any person  who, has  obtained  a  judgment against the insured or the insured's personal representative to enforce a right of contribution or indemnity,  or  any person subrogated to the judgment creditor's rights under such judgment; and  (3)  any assignee of a judgment obtained as specified in paragraph one or paragraph two of this subsection, subject further to  the  limitation contained in section 13-103 of the general obligations law.  (c)  (1)  If  an  action  is  maintained  against an insurer under the provisions of paragraph two of subsection (a) of this  section  and  the insurer  alleges  in  defense  that  the  insured  failed  or refused to cooperate with the insurer in violation of any provision in  the  policy or  contract  requiring  such cooperation, then the burden shall be upon the insurer to prove such alleged failure or refusal to cooperate.  (2)(A) In  any  action  in  which  an  insurer  alleges  that  it  was prejudiced as a result of a failure to provide timely notice, the burden of  proof  shall  be  on:  (i)  the  insurer  to  prove that it has been prejudiced, if the notice was provided within  two  years  of  the  time required  under the policy; or (ii) the insured, injured person or other claimant to prove that the insurer  has  not  been  prejudiced,  if  the notice  was  provided  more than two years after the time required under the policy.  (B)  Notwithstanding  subparagraph   (A)   of   this   paragraph,   an irrebuttable  presumption  of prejudice shall apply if, prior to notice, the insured's liability has been determined  by  a  court  of  competent jurisdiction  or  by binding arbitration; or if the insured has resolved the claim or suit by settlement or other compromise.  (C) The insurer's rights shall not be  deemed  prejudiced  unless  the failure  to  timely provide notice materially impairs the ability of the insurer to investigate or defend the claim.  (d)(1)(A) This paragraph applies with respect to  a  liability  policy that  provides coverage with respect to a claim arising out of the death or bodily injury of any person, where the  policy  is:  (i)  subject  to section  three  thousand four hundred twenty-five of this article, other than an excess liability or umbrella policy; or (ii) used to  satisfy  a financial responsibility requirement imposed by law or regulation.  (B)  Upon  an  insurer's  receipt  of  a written request by an injured person who has filed a claim or by another claimant, an  insurer  shall, within  sixty days of receipt of the written request: (i) confirm to the injured person or other claimant in writing whether the  insured  had  a liability  insurance policy of the type specified in subparagraph (A) of this paragraph in effect with the insurer on the  date  of  the  alleged occurrence;  and  (ii)  specify  the  liability  insurance limits of the coverage provided under the policy.  (C)  If  the  injured  person  or  other  claimant  fails  to  provide sufficient identifying information to allow the insurer, in the exercise of  reasonable  diligence, to identify a liability insurance policy that may be relevant to the claim, the insurer shall within  forty-five  days of receipt of the written request, so advise the injured person or other claimant  in  writing  and  identify  for  the  injured  person or other claimant the additional information needed. Within  forty-five  days  of  receipt  of  the  additional  information, the insurer shall provide the information required under subparagraph (B) of this paragraph.  (2)  If under a liability policy issued or delivered in this state, an insurer shall disclaim liability or deny coverage for  death  or  bodily injury  arising  out  of  a  motor vehicle accident or any other type of accident occurring within this state, it shall give  written  notice  as soon as is reasonably possible of such disclaimer of liability or denial of coverage to the insured and the injured person or any other claimant.  (e) No policy or contract of personal injury liability insurance or of property damage liability insurance, covering liability arising from the ownership,  maintenance  or  operation  of  any  motor vehicle or of any vehicle as defined in section three hundred eighty-eight of the  vehicle and  traffic  law,  or  an aircraft, or any vessel as defined in section forty-eight of the navigation law, shall be issued or delivered in  this state  to  the  owner  thereof,  or  shall be issued or delivered by any authorized insurer upon any such vehicle  or  aircraft  or  vessel  then principally  garaged  or  principally  used  in  this  state,  unless it contains a provision insuring the named insured  against  liability  for death  or  injury  sustained,  or  loss  or damage occasioned within the coverage of the policy or contract, as a result  of  negligence  in  the operation  or  use  of such vehicle, aircraft or vessel, as the case may be, by any person operating or  using  the  same  with  the  permission, express or implied, of the named insured.  (f)  (1)  No  policy  insuring  against  loss resulting from liability imposed by law for bodily injury or death suffered by any natural person arising out of the ownership, maintenance and use of a motor vehicle  or an  altered  motor vehicle commonly referred to as a "stretch limousine" having a seating capacity of  eight  or  more  passengers  used  in  the business of carrying or transporting passengers for hire, by the insured shall  be  issued  or delivered by any authorized insurer upon any motor vehicle or an altered motor vehicle commonly referred to as  a  "stretch limousine" having a seating capacity of eight or more passengers used in the  business  of  carrying  or  transporting  passengers for hire, then principally garaged or principally used in this state unless it contains a provision whereby the insurer agrees that it will pay to the  insured, as  defined  in  such provision, subject to the terms and conditions set forth therein to be prescribed by the board of directors  of  the  Motor Vehicle   Accident  Indemnification  Corporation  and  approved  by  the superintendent, all sums, not exceeding a maximum  amount  or  limit  of twenty-five thousand dollars exclusive of interest and costs, on account of  injury  to  and all sums, not exceeding a maximum amount or limit of fifty thousand dollars exclusive of interest and costs,  on  account  of death  of  one  person,  in  any one accident, and the maximum amount or limit, subject to such limit for any one  person  so  injured  of  fifty thousand dollars or so killed of one hundred thousand dollars, exclusive of  interest  and costs, on account of injury to, or death of, more than one person  in  any  one  accident,  which  the  insured  or  his  legal representative  shall be entitled to recover as damages from an owner or operator of an uninsured motor vehicle, unidentified motor vehicle which leaves the scene of an accident, a  motor  vehicle  registered  in  this state  as to which at the time of the accident there was not in effect a policy of  liability  insurance,  a  stolen  vehicle,  a  motor  vehicle operated without permission of the owner, an insured motor vehicle where the  insurer  disclaims  liability or denies coverage or an unregistered vehicle because of bodily injury, sickness or disease,  including  death resulting  therefrom,  sustained  by  the  insured,  caused  by accident occurring in this state and arising out of the ownership, maintenance or use of such motor vehicle. No payment for  non-economic  loss  shall  be  made  under such policy provision to a covered person unless such person has incurred a serious injury, as such terms are defined in section five thousand one  hundred  two  of  this  chapter.  Such  policy  shall  not duplicate  any element of basic economic loss provided for under article fifty-one of this chapter. No payments of first party benefits for basic economic  loss  made  pursuant  to  such  article  shall  diminish   the obligations  of  the insurer under this policy provision for the payment of non-economic loss and economic loss in excess of basic economic loss. Notwithstanding any inconsistent provisions of  section  three  thousand four hundred twenty-five of this article, any such policy which does not contain   the  aforesaid  provisions  shall  be  construed  as  if  such provisions were embodied therein.  (2) (A) Any such policy shall, at the  option  of  the  insured,  also provide  supplementary  uninsured/underinsured  motorists  insurance for bodily injury, in an amount up to the bodily injury liability  insurance limits  of  coverage provided under such policy, subject to a maximum of two hundred fifty thousand dollars because of bodily injury to or  death of  one  person  in  any one accident and, subject to such limit for one person, up to five hundred thousand dollars because of bodily injury  to or  death  of  two  or  more  persons in any one accident, or a combined single limit policy of five hundred thousand dollars because  of  bodily injury  to  or death of one or more persons in any one accident; and any such policy insuring against loss resulting from  liability  imposed  by law  for  bodily  injury or death suffered by any natural person arising out of the ownership, maintenance, and use of an altered  motor  vehicle commonly  referred to as a "stretch limousine" having a seating capacity of eight or  more  passengers  used  in  the  business  of  carrying  or transporting   passengers   for   hire,   shall   provide  supplementary uninsured/underinsured motorists insurance  for  bodily  injury,  in  an amount  of  a combined single limit of one million five hundred thousand dollars because of bodily injury or death of one or more persons in  any one  accident.  Provided  however,  an  insurer issuing any such policy, except a policy insuring against loss resulting from  liability  imposed by law for bodily injury or death suffered by any natural person arising out  of  the ownership, maintenance, and use of an altered motor vehicle commonly referred to as a "stretch limousine" having a seating  capacity of  eight  or  more  passengers  used  in  the  business  of carrying or transporting passengers for hire, in lieu of offering to the insured the coverages stated above, may provide supplementary uninsured/underinsured motorists insurance for bodily injury, in an amount  up  to  the  bodily injury  liability  insurance  limits  of  coverage  provided  under such policy, subject to a maximum of one hundred thousand dollars because  of bodily injury to or death of one person in any one accident and, subject to  such  limit  for  one  person,  up to three hundred thousand dollars because of bodily injury to or death of two or more persons in  any  one accident,  or  a  combined single limit policy of three hundred thousand dollars because of bodily injury to or death of one or more  persons  in any  one  accident,  if  such  insurer  also  makes available a personal umbrella policy with liability coverage  limits  up  to  at  least  five hundred  thousand dollars which also provides coverage for supplementary uninsured/underinsured       motorists       claims.       Supplementary uninsured/underinsured  motorists  insurance  shall provide coverage, in any state or Canadian province, if the limits  of  liability  under  all bodily  injury  liability  bonds and insurance policies of another motor vehicle liable for damages are in a lesser amount than the bodily injury liability insurance limits of coverage provided  by  such  policy.  Upon written    request    by    any    insured   covered   by   supplemental uninsured/underinsured  motorists  insurance  or  his  duly   authorized  representative  and  upon  disclosure  by  the  insured of the insured's bodily  injury   and   supplemental   uninsured/underinsured   motorists insurance coverage limits, the insurer of any other owner or operator of another motor vehicle against which a claim has been made for damages to the  insured  shall disclose, within forty-five days of the request, the bodily injury liability insurance limits of its coverage provided  under the policy or all bodily injury liability bonds. The time of the insured to  make  any supplementary uninsured/underinsured motorist claim, shall be tolled during the period the insurer of any other owner  or  operator of  another motor vehicle that may be liable for damages to the insured, fails to so disclose its coverage.  As  a  condition  precedent  to  the obligation   of   the   insurer   to   pay   under   the   supplementary uninsured/underinsured  motorists  insurance  coverage,  the  limits  of liability  of  all  bodily  injury liability bonds or insurance policies applicable at the time of the accident shall be exhausted by payment  of judgments or settlements.  (B)  In  addition to the notice provided, upon issuance of a policy of motor vehicle liability insurance pursuant to regulations promulgated by the superintendent, insurers shall notify insureds, in writing,  of  the availability of supplementary uninsured/underinsured motorists coverage. Such   notification   shall  contain  an  explanation  of  supplementary uninsured/underinsured motorists coverage and the amounts  in  which  it can  be purchased. Subsequently, a notification of availability shall be provided at least  once  a  year  and  may  be  simplified  pursuant  to regulations  promulgated  by  the  superintendent,  but  must  include a concise statement that  supplementary  uninsured/underinsured  motorists coverage is available, an explanation of such coverage, and the coverage limits that can be purchased from the insurer.   * (2-a)  (A)  Notwithstanding  paragraph  two of this subsection, this paragraph shall apply to any new insurance policy or contract subject to this subsection entered into after the effective date of this paragraph. This paragraph shall not be deemed to apply to any  policies  originally entered  into prior to the effective date of this paragraph, but renewed after the effective  date  of  this  paragraph,  or  to  any  policy  of commercial  risk insurance. Any new insurance policy or contract entered into after the effective date of this paragraph shall, at the option  of the     first     named     insured,    also    provide    supplementary uninsured/underinsured motorists insurance  for  bodily  injury,  in  an amount equal to the bodily injury liability insurance limits of coverage provided  under such motor vehicle liability insurance policy; provided, however, that a first named insured may exercise the choice  to  decline such  supplementary uninsured/underinsured motorists insurance or select a  lower  amount  of  coverage  through  a  written  waiver  signed,  or electronically  signed,  by such insured, subject to the requirements of subparagraph (B) of this paragraph. Supplementary uninsured/underinsured motorists insurance shall provide coverage, in  any  state  or  Canadian province,  if  the limits of liability under all bodily injury liability bonds and insurance policies of  any  other  motor  vehicle  liable  for damages  are  in  a  lesser  amount  than  the  bodily  injury liability insurance limits of coverage  provided  by  such  policy.  Upon  written request  by  any  insured covered by supplemental uninsured/underinsured motorists  insurance  or  a  duly  authorized  representative  and  upon disclosure   by   the   insured  of  the  insured's  bodily  injury  and supplemental uninsured/underinsured motorists insurance coverage limits, the insurer of any other owner or  operator  of  another  motor  vehicle against  which  a  claim  has been made for damages to the insured shall disclose, within forty-five days  of  the  request,  the  bodily  injury liability  insurance limits of its coverage provided under the policy or  all bodily injury liability bonds. The time of the insured to  make  any supplementary  uninsured/underinsured  motorist  claim,  shall be tolled during the period the insurer of any other owner or operator of  another motor vehicle that may be liable for damages to the insured, fails to so disclose its coverage. As a condition precedent to the obligation of the insurer  to pay under the supplementary uninsured/underinsured motorists insurance coverage,  the  limits  of  liability  of  all  bodily  injury liability  bonds  or  insurance  policies  applicable at the time of the accident shall be exhausted by payment of judgments or settlements.  (B) In addition to the notice provided, upon issuance of a  policy  of motor vehicle liability insurance pursuant to regulations promulgated by the  superintendent,  insurers shall notify insureds, in writing, of the availability of supplementary uninsured/underinsured motorists coverage. Such  notification  shall  contain  an  explanation   of   supplementary uninsured/underinsured  motorists  coverage  and the amounts in which it can be purchased. Subsequently, a notification of availability shall  be provided  at  least  once  a  year  and  may  be  simplified pursuant to regulations promulgated  by  the  superintendent,  but  must  include  a concise  statement  that  supplementary uninsured/underinsured motorists coverage is available, an explanation of such coverage, and the coverage limits that can be purchased from the insurer. If an insured  elects  to reject  supplementary uninsured/underinsured motorist coverage or select a lower amount of supplementary uninsured/underinsured motorist coverage than the bodily injury liability insurance limits of  coverage  provided under  the  insured's  motor  vehicle  liability  insurance  policy, the selection  of  lower  supplementary   uninsured/underinsured   motorists coverage  or  rejection  of  such  coverage must be made on a written or electronic form provided to the first named  insured.  Such  form  shall also  advise  that such coverage is equal to the insured's bodily injury liability limits under the  motor  vehicle  liability  insurance  policy unless lower limits are requested or the coverage is rejected.  (i)    The    form    shall    also    advise    that    supplementary uninsured/underinsured  motorists  coverage  (sum   coverage)   provides insurance  protection  for  any  person  included  as insured under your policy if he or she is injured in an accident  involving  another  motor vehicle  whose  owner  or  operator  was negligent but who has either no bodily injury or liability insurance, or less  than  the  insurance  you carry.  Sum  coverage  shall  be equal to the level of the bodily injury liability coverage of your  motor  vehicle  liability  insurance  policy unless  you  sign  a  waiver  requesting lower coverage or declining the coverage. You are urged to carefully consider this decision.  (ii) An  insured's  written  waiver  shall  apply  to  all  subsequent renewals  of  coverage and to all policies or endorsements which extend, change, supersede, or replace an existing policy  issued  to  the  named insured, unless changed in writing by any named insured.  (iii)  The  selection  of  lower  supplementary uninsured/underinsured motorists coverage or the rejection of such coverage by any first  named insured shall be binding upon all insureds under such policy.  (C)  Notwithstanding  the  provisions  of  subparagraph  (A)  of  this paragraph,  at  the  insurer's  option,  the   insured's   supplementary uninsured/underinsured motorists coverage limit may be required to equal the  insured's  bodily  injury liability insurance limit under the motor vehicle liability insurance policy.  (D) An insurer may provide the coverage described  in  this  paragraph available  in  an umbrella or excess liability policy if the umbrella or excess liability policy expressly provides such coverage.   * NB Repealed June 30, 2023  (3) The protection provided by this subsection shall not apply to  any cause  of  action  by  an  insured person arising out of a motor vehicle accident occurring in this state against  a  person  whose  identity  is unascertainable,  unless  the  bodily injury to the insured person arose out of physical contact of the motor vehicle causing the injury with the insured  person  or  with  a  motor vehicle which the insured person was occupying (meaning in or upon or entering into or alighting from) at the time of the accident.  (4) An insurer shall give notice to the commissioner of motor vehicles of the entry of any judgment upon which a claim  is  made  against  such insurer  under  this  subsection and of the payment or settlement of any claim by the insurer.  (5) This paragraph shall apply to a policy that provides supplementary uninsured/underinsured motorist insurance coverage for bodily injury and is a policy: (A) issued or delivered in this state that insures  against liability  arising  out of the ownership, maintenance, and use of a fire vehicle, as defined in section one hundred fifteen-a of the vehicle  and traffic  law,  where  the fire vehicle is principally garaged or used in this state; or (B) as specified in paragraph  one  of  this  subsection. Every  such  policy  that  insures  a  fire department, fire company, as defined in  section  one  hundred  of  the  general  municipal  law,  an ambulance  service,  or  a  voluntary  ambulance  service, as defined in section three thousand one of the public health law, shall provide  such supplementary  uninsured/underinsured  motorist insurance coverage to an individual employed by or who is a member of the fire  department,  fire company,  ambulance  service,  or voluntary ambulance service and who is injured by an uninsured or underinsured motor vehicle  while  acting  in the  scope  of  the  individual's  duties  for the fire department, fire company, ambulance service, or voluntary ambulance service covered under the policy, except with respect to the  use  or  operation  by  such  an individual of a motor vehicle not covered under the policy.  (g)  No  policy  or  contract  shall  be  deemed to insure against any liability of an insured because of death of or injuries to  his  or  her spouse or because of injury to, or destruction of property of his or her spouse   unless  express  provision  relating  specifically  thereto  is included in the policy as provided in paragraphs one  and  two  of  this subsection. This exclusion shall apply only where the injured spouse, to be  entitled  to recover, must prove the culpable conduct of the insured spouse.  (1) Upon written  request  of  an  insured,  and  upon  payment  of  a reasonable  premium  established in accordance with article twenty-three of this chapter, an  insurer  issuing  or  delivering  any  policy  that satisfies the requirements of article six of the vehicle and traffic law shall  provide coverage against liability of an insured because of death of or injuries to his or her spouse up to the liability insurance limits provided under such policy even where the injured spouse, to be entitled to recover, must prove the culpable conduct of the insured spouse.  Such insurance  coverage  shall  be  known as "supplemental spousal liability insurance".  (2) Upon issuance of a motor vehicle liability policy  that  satisfies the  requirements of article six of the vehicle and traffic law and that becomes effective  on  or  after  January  first,  two  thousand  three, pursuant  to  regulations promulgated by the superintendent, the insurer shall  notify  the  insured,  in  writing,  of   the   availability   of supplemental  spousal  liability  insurance.  Such notification shall be contained on the front of  the  premium  notice  in  boldface  type  and include  a  concise  statement  that  supplementary  spousal coverage is available, an explanation of such coverage, and  the  insurer's  premium  for  such  coverage. Subsequently, a notification of the availability of supplementary spousal liability coverage shall be provided at least once a year in motor vehicle liability policies issued  pursuant  to  article six  of  the  vehicle and traffic law, including those originally issued prior to January first, two thousand three. Such notice must  include  a concise  statement  that supplementary spousal coverage is available, an explanation of  such  coverage,  and  the  insurer's  premium  for  such coverage.  (h)  In  this  section,  the term "insurance upon any property or risk located in  this  state"  includes  insurance  against  legal  liability arising  out  of  the ownership, operation or maintenance of any vehicle which is principally garaged or  principally  used  in  this  state,  or arising  out  of  the  ownership,  operation,  use or maintenance of any property which is principally kept or principally used in this state, or arising out of any other activity which is  principally  carried  on  in this state.  (i)  Except  as  provided  in  subsection  (j)  of  this  section, the provisions of this section shall not apply to any policy or contract  of insurance  in  so  far  as  it  covers  the liability of an employer for workers' compensation, if such contract is governed by the provisions of section fifty-four of the workers' compensation law, or by  any  similar law  of  another  state,  province  or  country,  nor  to  the  kinds of insurances set forth in paragraph three of subsection (b) of section two thousand one hundred seventeen of this chapter.  (j) (1) Notwithstanding any other provision of  this  chapter  or  any other law to the contrary, every policy providing comprehensive personal liability  insurance  on a one, two, three or four family owner-occupied dwelling, issued or delivered in this state on and after  the  first  of March,   nineteen   eighty-four,  shall  provide  for  coverage  against liability for the payment of any obligation, which the policyholder  may incur pursuant to the provisions of the workers' compensation law, to an employee  arising  out  of  and in the course of employment of less than forty hours per week, in and about such residences of  the  policyholder in  this  state.  Such  coverage  shall  provide for the benefits in the standard workers' compensation policy issued in this state. No  one  who purchases  a policy providing comprehensive personal liability insurance shall be deemed to have elected to cover under the workers' compensation law any employee who is not required, under the provisions of such  law, to be covered.  (2)  The  term  "policyholder"  as  used  in  this subsection shall be limited to an individual or individuals as defined by the terms  of  the policy, but shall not include corporate or other business entities or an individual  who  has  or  individuals  who  have  in  effect  a workers' compensation policy which covers employees working in and about  his  or their residence.  (3)  Every  insurer  who  is  licensed  by the superintendent to issue homeowners or other policies providing comprehensive personal  liability insurance  in this state shall also be deemed to be licensed to transact workers' compensation  insurance  for  the  purpose  of  covering  those persons specified in this subsection.