|  UPDATE: President Biden signed the bill into law on Dec. 29, 2022.
An omnibus spending plan approved by Congress today includes a nine-month re-authorization of the National Flood Insurance Program (NFIP.) President Joseph R. Biden, Jr. has pledged to sign the measure, which sets federal government appropriations for the 2023 fiscal year. The reauthorization means that you will be able to obtain new and renewal flood insurance policies through the program without interruption. Congress has authorized the NFIP on a temporary basis since its inception in 1968. Its most recent authorization was due to expire at the end of the day December 23 when appropriations for the federal government were also to run out. The newly enacted bill will keep the government and the flood program running for the rest of the 2023 fiscal year, which ends on September 30, 2023. Those of you who obtain flood coverage for your clients through the
Big I Flood Program will be able to continue to do so at least until next autumn.
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| We get frequent questions (that is, six or more in the last two weeks) about cancellation, non-renewal and conditional renewal letters from insurers. A lot of members refer to these as "220 letters," so called because the law that requires them for many types of commercial lines policies (Section 3426 of the New York Insurance Law) was enacted as Chapter 220 of the Laws of 1986.
Here in one place are links to some of our posts and answers to member questions about what insurers are and are not required to do. This list will likely grow with time, but here is some information to help you out for today:
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What Happened:
On November 21st, Governor Hochul vetoed our bill, S.6028/A.6877, which would have allowed insurance companies to waive CARCO inspections. In her veto message, the Governor cited concerns that the bill would remove protections against fraud, increase insurance rates, and harm the businesses that perform photo inspections. What's Next: While we are deeply disappointed the bill was vetoed, we remain confident there is a path forward. In her veto message, Governor Hochul stated that “with modern technology the [photo inspection requirement] could be updated in a responsible way," and that “I am willing to work with the legislature, the insurance industry, and the automotive industry during the upcoming legislative session to identify a solution…" Big I NY has met with key members of the Governor's staff, and this commitment was reaffirmed to us. We will continue to work with Governor Hochul to come to an agreement as quickly as possible, so a new bill can be passed in early 2023. We have provided strong evidence to allay each of her concerns about the bill. Big I NY Has Your Back: This bill faced numerous setbacks and challenges in 2022, yet with persistence and the vocal support of our agents they were overcome. For the first time ever the bill passed both houses of the legislature, with strong bipartisan support. Rest assured we will push even harder to get this done in 2023, and keep an eye on your inbox for more opportunities to speak up and advocate for this bill.
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Photo by South Carolina National Guard.
Public Domain.
UPDATE: Congress approved a one-week extension of the current federal budget late on Dec. 15. The flood program is now due to expire at 11:59 pm on Dec. 23. The
National Flood Insurance Program will run out of authorization to operate on
Dec. 16, barring congressional action. The program, which Congress has authorized on a temporary basis since its inception in 1968, will lose the ability to issue or renew policies on that date.
Reauthorization of the NFIP is not controversial. However, its authorization is tied to approval of an overall spending plan for the federal government. The government's fiscal year ends on September 30 each year. In most years, Congress fails to adopt a budget before the fiscal year end and the government operates under short-term funding measures known as
"continuing resolutions." Continuing resolutions authorize government spending until a certain date. The most recent continuing resolution runs out on Dec. 16.
Congressional negotiators are
working on a deal that would keep the government open until Dec. 23, giving them a week to work out a spending plan for the rest of the fiscal year. If that deal becomes law, the NFIP will operate as normal until that date, at which time it would again be scheduled to expire.
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| The New York Compensation Insurance Rating Board is eliminating eight Workers' Compensation classifications next fall. The classifications will no longer be assigned to employers as of Oct. 1, 2023. This may impact some of the employers you insure.
In a bulletin, the board said that the classifications were "low credibility," and the operations they cover were being combined with other related classifications.
The affected classifications are:
- 2670, Glove Manufacturing (Mfg.) – Leather or Textile, and 2689, Pocketbook Mfg. are being combined with 2688, Leather Goods Mfg. – Not Otherwise Classified (NOC)
- 2913, Rattan, Willow or Twisted Fiber Products Mfg. is being combined with 2883, Furniture Mfg. – NOC – Wood
- 3381, Silverware Mfg., 3384, Precious Stone Setting, and 3385, Clock Mfg. are being combined with 3383, Jewelry Mfg.
- 4298, Sample Card Mfg. is being combined with 4251, Stationery Mfg.
- 4597, Paste, Ink (Writing) or Mucilage Mfg. is being combined with 4557, Ink Mfg. – Printing
All of the classifications other than 4298, Sample Card Mfg. will be subject to a three-year loss cost transition period. Their elimination will become final on Oct. 1, 2025. If you have any Workers Compensation insurance clients whose operations bear any of these classifications, you may want to inform them that their policies issued after Oct. 1, 2023 will show the new classifications.
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