2023 New York Laws › ISC - Insurance › Article 21 - Agents, Brokers, Adjusters, Consultants and Intermediaries › 2130 - Excess Line Association.

* §  2130.  Excess  line  association.  (a)  There is hereby created a
non-profit association to be known as the excess line association of New
York. All excess line licensees shall be deemed to  be  members  of  the
association.  The  association must perform its functions under the plan
of operation established and  approved  under  subsection  (c)  of  this
section  and  must  exercise  its  powers  through  a board of directors
established under subsection (b) of this section. The association  shall
be supervised by the superintendent. The association shall be authorized
and have the duty to:
(1)  receive  and  record  all  excess  line insurance documents which
excess line brokers are required to  file  with  the  association  under
section  two  thousand one hundred eighteen of this article. All records
which an excess line broker is required to maintain  under  section  two
thousand  one  hundred  eighteen  of  this  article  shall  be  open  to
examination by the excess line association;
(2) notify the  superintendent  or  his  designee  prior  to  stamping
submitted  insurance  documents  as  provided in paragraph three of this
subsection if the association believes  that  the  unauthorized  insurer
does  not  meet  the  standards  of  eligibility  imposed by section two
thousand one hundred eighteen of this article, together with  any  rules
and regulations promulgated pursuant to said section;
(3)  stamp  all  excess  line  insurance  documents  which excess line
brokers are required to file with  the  association  under  section  two
thousand  one  hundred  eighteen  of  this  article,  provided  that  an
unauthorized insurer meets  the  standards  of  eligibility  imposed  by
section two thousand one hundred eighteen of this article, together with
any rules and regulations promulgated pursuant to said section;
(4)  prepare  reports  to  be  provided  to  the superintendent on the
fifteenth day of every month, which reports shall include  premium  data
from  excess  line licensee affidavits relating to excess line insurance
filed by each  licensee  and  stamped  by  the  association  during  the
preceding  calendar month. Such reports shall also include corresponding
licensee affidavits in such form as the  superintendent  may  prescribe.
The association shall provide each licensee with a copy of the report as
it pertains to said licensee's business for the calendar month;
(5)  prepare  and  deliver  to each licensee and to the superintendent
annually the reports  of  excess  line  business,  which  reports  shall
include  a  delineation  of  the  classes and kinds of business procured
during the preceding calendar year in such form  as  the  superintendent
may prescribe;
(6)  deliver  to  each licensee standard forms for affidavits required
under section two thousand one hundred eighteen of this article;
(7) employ and retain such persons as are necessary to carry  out  the
duties of the association;
(8)   borrow  money  as  necessary  to  effect  the  purposes  of  the
association;
(9) enter contracts  as  necessary  to  effect  the  purposes  of  the
association;
(10)  perform  such  other  acts  as  will  facilitate  and  encourage
compliance by its members with the excess line law  of  this  state  and
rules promulgated thereunder; and
(11)  provide  such other services to its members as are incidental or
related to the purposes of the association; and
(12) utilize the  authority  granted  to  unincorporated  associations
under section twelve of the general associations law.
(b)(1)  The  association  shall  function through a board of directors
elected by the association members, and officers who shall be elected by
the board of directors.
(2) The board of directors of the association  shall  consist  of  not
less  than  five nor more than nine persons serving terms as established
in the plan of operation. The plan of operation shall  provide  for  the
election  of a board of directors by the members of the association from
its membership. The plan of operation shall fix the manner of voting and
may weigh each member's vote to reflect the annual excess line insurance
premium  written  by  the  member.  Members  employed  by  the  same  or
affiliated employers may consolidate their premiums written and delegate
an individual officer or partner to represent the member in the exercise
of association affairs, including service on the  association  board  of
directors.  The  superintendent  shall,  within  thirty  days  after the
enactment date of this section, appoint an interim  board  of  directors
for  the  sole  purpose  of  conducting  an  election of directors which
election shall be conducted within sixty days after the  enactment  date
of this section.
(3)  The  board  of  directors  shall  elect  such  officers as may be
provided in the plan of operation.
(c)(1) The association shall submit to the superintendent  a  plan  of
operation and any amendments thereto to provide operating procedures for
the  administration  of  the  association. The plan of operation and any
amendments thereto shall become effective upon approval  in  writing  by
the superintendent.
(2) All association members must comply with the plan of operation.
(d) (1) The superintendent shall at least once in three years, make or
cause  to be made an examination of the association. The reasonable cost
of  any  such  examination  shall  be  paid  by  the  association   upon
presentation  to  it by the superintendent of a detailed account of such
cost. Any examiner authorized by the superintendent shall have the power
to administer oaths and to examine under  oath  any  director,  officer,
member,  agent or employee of the association. During the course of such
examination, the directors, officers, members, agents and  employees  of
the  association  shall  make  available  all  books, records, accounts,
documents and agreements pertaining thereto.  The  superintendent  shall
furnish  a  copy  of  the  examination report to the association. Within
thirty days after receipt of the report, the association may  request  a
hearing  on  the  report or any facts or recommendations therein. If the
superintendent finds the association is  not  in  compliance  with  this
section  he may issue an order requiring compliance or discontinuance of
such violation and the association  shall  be  subject  to  the  penalty
provisions of this chapter.
(2)  A  director  may  be  removed  from  the  association's  board of
directors by the superintendent for cause, stated in writing,  after  an
opportunity has been given to the director to be heard thereon.
(e)  In  the  absence  of gross negligence, fraud, or bad faith, there
shall be no liability on the part of and no  causes  of  action  of  any
nature  shall  arise  against  the association, its directors, officers,
agents, or employees for any action taken or  omitted  by  them  in  the
performance   of   their  powers  and  duties  under  this  section  and
subsections (b), (c)  and  (f)  of  section  two  thousand  one  hundred
eighteen of this article.
(f)  The  services  performed  by the association shall be funded by a
stamping fee assessed for each declarations page, cover  note  or  other
premium  bearing document submitted to the association. The stamping fee
shall be established by the board of directors of the  association  from
time to time and shall be subject to approval by the superintendent. The
stamping  fee  shall  be  paid  by  the  excess line licensee. Provided,
however, the licensee shall be allowed to receive and collect  from  the
insured  the  stamping fee if the licensee obtains a written memorandum,

signed by the insured, specifying the amount and the insured's agreement
to pay the stamping fee.
(g)  Nothing  in  this  section  shall  be  construed  to  modify  the
obligation of an excess line licensee to comply with the  provisions  of
sections  two  thousand  one  hundred  five and two thousand one hundred
eighteen  of  this  chapter,  nor  to  diminish   the   power   of   the
superintendent   to   take   any  other  disciplinary  action  otherwise
authorized by this chapter.
(h) The superintendent may declare an unauthorized insurer  ineligible
and  order  the  association  not to stamp insurance documents issued by
such unauthorized insurer.
(i) Compliance by  the  association  with  the  duties  set  forth  in
subsection  (a)  of  this  section in connection with filing, receiving,
recording and stamping of excess line insurance documents,  as  well  as
the  requirement  to  deliver  standard  forms  for  affidavits,  may be
accomplished  by  means  of  electronic  or  other  media  transmission,
provided  that the superintendent first approves such methods of filing,
receiving, recording and stamping.
* NB Expires July 1, 2029