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Feb 28
UPC To Be Liquidated; Client Form Letter Available

UPDATE April 6, 2023: This article has been edited to clarify that the insurer in question is United Property & Casualty Insurance Company  and not another insurer sometimes known by the acronym "UPC."

UPDATE March 28, 2023: On March 7, 2023, the Florida Department of Financial Services asked the New York DFS to commence "ancillary receivership" proceedings with regard to UPC. An ancillary receiver handles the liquidation of a business headquarterd in another state, where that state has started liquidication. The NYS DFS applied to a Manhattan court on March 22 for an order appointing it as ancillary receiver. The court has scheduled a hearing for April 25​, at which time the  NYS DFS request will likely be granted. Once NYS DFS has been appointed ancillary receiver, it wil lhave the legal ability to begin liquidating UPC's New York business.

UPDATE March 22, 2023: We have been advised that Interboro Insurance Co., an affiliate of UPC's, is attempthing to rewrite as many of the New York UPC policies as it can. This may be a viable market for some or all of your UPC clients.​

UPDATE March 1, 2023: On February 27, 2023, a Florida circuit court granted the Florida Department of Financial Services' request to be appointed as receiver of the estate of UPC Insurance. The court's order gives the FL DFS authority to liquidate the carrier's assets. All UPC policies will be cancelled effective March 29, 2023. All claims for coverage must be presented to the department no later than February 27, 2024. Visit the department's website for the liquidation​ for more details.

​Florida-based property-casualty insurer United Property & Casualty Insurance Company​ (UPC) is insolvent and is to be liquidated, according to a consent order made public on Feb. 17. If you have clients who own UPC policies, we urge you to contact them as soon as possible to inform them of this development and discuss replacing coverage.

The insurer, which as of last summer had 151,325 policies in force in six states other than Florida (including New York,)  was under the supervision of the Florida Office of Insurance Regulation pursuant to a runoff plan​ agreed to by the insurer and the OIR last December. The plan was for the insurer to remain solvent while making an orderly exit from its markets.

However, the OIR informed the Florida Department of Financial services on Feb. 16 that UPC is insolvent According to an affidavit signed by Virgina A. Christy, the OIR's director of property & casualty financial oversight, the company's policyholder surplus at the end of 2022 was negative $217,603,217. This means that if the company sold all its assets on Dec. 31, 2022, almost $218 million in losses would remain unpaid. 

The company signed a consent order on Feb. 8 agreeing to the appointment of the DFS as receiver "​for purposes of Rehabilitation or Liquidation ..." ​Once a state court formally appoints DFS as the receiver and approves a liquidation plan, the department will begin the process. 

Under a prior consent order, UPC was under court orders to cancel all policies by May 31, 2023. It is unclear whether the Florida DFS will seek to have that date moved up.

According to a report in Insurance Journal, the Florida Insurance Guaranty Association​ will handle as many as 20,000 claims resulting from the liquidation. 

If you have clients insured by UPC, you may want to contact them to inform them of the insolvency and discuss what their next steps might be. Big I New York members have free access to our ebook The Big I NY Big Book of Form Letters & Other E&O Tools. Among the form letters included in the book is one titled "Letter To Customer Advising that Insurer's Financial Rating Has Been Downgraded​." You may find this form letter useful for your communications with clients. ​You can download a copy of the book in PDF format from the Big I New York Portal​

Feb 27
How A Hard Market Can Impact Your Agency's Profitability
By: Carey Wallace

​A hard market is a term used in the insurance industry to describe a period of time when insurance premiums are generally increasing, and underwriting standards are becoming more stringent. A hard market may be the result of a variety of factors, including increased claims and losses, rising costs for insurance companies, and increased regulation. In this environment, an independent insurance agency's profitability may be impacted in several ways. That impact can be positive for some agencies and negative for others based on how well an agency responds to their customer's needs.  

During a hard market, insurance companies may experience increased commission and fee revenue provided that their customers can withstand the rate increases. This can also occur due to their customers incurring higher claims and losses, which can lead to higher premiums for policyholders. As a result of these increased premiums, independent insurance agencies may find it more difficult to sell policies to potential customers and retain their current customers as the higher premiums may be less affordable for some consumers. This can lead to lower sales and retention revenue for the agency. 

Additionally, during a hard market, insurance companies may also be more selective about the risks they are willing to cover, which can result in a decrease in the number of policies that are available to sell. This can also lead to lower sales and revenue for the agency. Independent insurance agencies may also face increased competition from other agencies as they try to win business in a challenging market. This can lead to lower profit margins for the agency. There are several things that independent insurance agencies can do to minimize the impact of a hard market on their agency: 

  1. Focus on providing excellent customer service: Providing outstanding customer service can help to retain existing clients and attract new ones, even in a challenging market. 
  2. Build and execute a strong retention strategy: Communicate clearly to your current customers about the market conditions and be proactive in your approach. This is a time when your advice and guidance are key to building a strong relationship with your customers. 
  3. Diversify the types of insurance products offered: Offering a variety of insurance products can help to mitigate the impact of a hard market in any one specific area. For example, if one type of insurance is experiencing higher premiums due to increased claims, the agency may be able to offset this impact by selling more policies in a different area where premiums are stable or even decreasing.
  4. Develop a strong digital presence: In today's world, having a strong presence online is essential for businesses of all types, including insurance agencies. By improving your website, maintaining an active social media presence, and using digital marketing techniques, agencies can reach new customers and expand their reach. 
  5. Look for opportunities to save money: In a hard market, it may be necessary to look for ways to reduce expenses in order to maintain profitability. This could include negotiating lower rates with suppliers, finding more cost-effective ways to advertise, or streamlining operations to reduce inefficiencies. Investments in your agency's efficiency are key, and those agencies that have made these investments will be well-positioned to perform well in a hard market situation. 
  6. Consider joining a network: By joining a network an agency can expand the range of products and services offered and increase the number of customers they can serve. 

By implementing these strategies, independent insurance agencies can minimize the potential negative impacts of a hard market and continue to operate successfully. Agencies that anticipate and prepare for the changing insurance environment are able to be better equipped to meet the needs of their customers. 

By simply having the infrastructure, procedures, and foresight to be proactive they will be able to outperform agencies that continue to operate the way they always have. The ability to be nimble and adjust as the market conditions change will be appreciated by their customers and will serve agencies well in a hard market. 

Feb 17
U.S. Presidents and New York, Sports & Music


Monday February 20 is Presidents Day, when the country celebrates the 46 men (they've all been men so far) who have held the land's highest office. You may not have known this, but your resident Insurance Geek is also a History Geek. In honor of the holiday, I've assembled some information about our former chief executives that many of you may not know.

Five presidents were born in the Empire State:

  • Martin Van Buren (Kinderhook, Columbia County 1782)
  • Millard Fillmore (Moravia, Cayuga County 1800
  • Theodore Roosevelt (New York, New York County, 1858)
  • Franklin Delano Roosevelt (Hyde Park, Dutchess County 1882)
  • Donald Trump, (Queens, Queens County 1946)

Ten others lived in New York before or during their presidencies  for periods of time ranging from a few months to many years :

  • George Washington (1789 – 1791)
  • James Monroe (1786 - 1789)
  • Ulysses S. Grant (1839 – 1843)
  • Chester Arthur (off and on from 1832 – 1886)
  • Grover Cleveland (1841 – 1885, 1889 -1893)
  • Dwight D. Eisenhower (1911 – 1915, 1948 – 1953)
  • John F. Kennedy (1927 – 1935)
  • Richard Nixon (1963 – 1969)
  • Jimmy Carter (1953)
  • Barack Obama (1981 -1985)

Sadly, one president died in New York while in office. William McKinley was shot while visiting the Pan-American Exposition in Buffalo on September 6, 1901. He died eight days later.

On a happier note, a lot of presidents were amateur athletes in high school, college, or in amateur leagues:

  • Abraham Lincoln (amateur wrestling)
  • Theodore Roosevelt (college boxing)
  • Dwight D. Eisenhower (college football)
  • John F. Kennedy (high school football, college swimming, golf)
  • Richard Nixon was a second string college football player, but he designed a play for the Washington football team to use in Super Bowl VII
  • Gerald Ford won two national championships as a member of the University of Michigan football team and rejected offers to play in the NFL for the Detroit Lions and Green Bay Packers
  • Jimmy Carter (American Legion baseball, college cross country)
  • George H.W. Bush (college baseball)
  • George W. Bush (marathon running)
  • Barack Obama (high school basketball)

Lastly, several of our commanders in chief had a musical bent:

  • Thomas Jefferson (violin)
  • John Quincy Adams (flute)
  • John Tyler (violin)
  • Warren G. Harding (multiple band instruments)
  • Harry Truman (piano)
  • Richard Nixon (piano, saxophone, clarinet, violin, accordion)
  • Bill Clinton (saxophone)
  • Barack Obama famously sang the hymn Amazing Grace

In closing, I ask that, in honor of our forefathers, you consider sharing your voice through our upcoming virtual Advocacy Week. It's quick and easy to do, and a pretty cool experience to tell people about. Fill this out,​ and Scott Hobson will get back to you. 

Feb 15
The Simple Certificate of Insurance Rules That Are Hard To Follow

​Nearly eight years after New York’s certificates of insurance law​ took effect, there appears to still be some misunderstanding of what the law allows and prohibits. Big I New York members regularly call or email us about whether it’s permissible to use certain forms, certain wording, show certificate holders in a certain way, what limits to display, and so on. Other members will receive a certificate form from a client’s subcontractor or vendor and wonder if the form is legal.

The fact of the matter is that most of these questions way over-complicate what the law says. When it comes to an insurance agency or brokerage issuing a certificate of insurance, there are only a few things to keep in mind. First, if your insurance carrier says no, you can’t do it. Otherwise, the New York State Department of Financial Services (DFS) could conclude that you have “demonstrated untrustworthiness,” an offense for which you can be disciplined under Section 2110 of the New York Insurance Law.

Outside of that, there are exactly two things the certificates law prohibits. You will find them in subsection (c) of Section 502 of the New York Insurance Law. Section 502 is part of Article 5, titled Certificates of Insurance. It says:

“In this state: …

(c) A certificate of insurance shall not amend, extend, or alter the coverage provided by the insurance policy to which the certificate of insurance makes reference. A certificate of insurance shall further not confer to any person any rights beyond those expressly provided by the policy of insurance referenced therein.”

That’s it. Follow those two rules and you will be following the certificates of insurance law. Everything else is just compliance with carrier contracts and errors and omissions liability loss prevention. You can answer virtually any certificates question you have by referring to those two rules. For example:

  1. Is it legal for me to use a non-ACORD certificate form? If the insurance carrier approves and the form does not change the coverage or grant any new rights to anyone, you can issue an ACORD form, an ISO form, a government agency form, a general contractor’s form, or a form drawn by hand on the back of a paper menu from Applebee’s.
  2. Is it legal to show limits on the certificate that are lower than those on the policy because the insured wants me to enter the lower amounts? If showing lower limits does not change the coverage (which I doubt,) then you can do it. Otherwise, you can’t.
  3. Can I list as additional insureds on a certificate the certificate holder, its successors and assigns, officers, directors, employees, vendors, members of its LinkedIn group, actors who appear in its commercials, and any interplanetary relatives? If the policy covers all of them as additional insureds, yes. Otherwise, the certificate would confer rights beyond those expressly provided by the policy. 
  4. Is it legal for my client’s contractor to give them an unapproved certificate form? See question #1 above.
  5. Is it legal to name more than one certificate holder? “Certificate holder” is not a term you will find anywhere in a commercial liability insurance policy. Whether you list one or ten, you’re not changing the coverage, so it’s legal.
  6. Is it legal to say on a certificate that a certain entity is an additional insured “if required by written contract”?  If the policy coverage form or an endorsement says that, then it’s permissible. However, if the additional insured’s name does not appear anywhere in the policy, you must cite the title and/or number of the coverage form or endorsement that grants the coverage. Otherwise, you are amending the coverage provided by the policy.
  7. Is it legal to not show the Employers Liability Insurance limits in the Workers’ Compensation policy, since E.L. Coverage is unlimited in New York?  No, because that would be amending the Workers’ Compensation insurance policy. E.L. Coverage is unlimited for employees subject to the New York Workers’ Compensation Law, but not every employee is subject to the law.

Remember: If the wording is not changing the coverage and not granting new rights, and it is acceptable to the insurance carrier, then it is legally permissible. Not necessarily a good idea, but permissible. E&O defense attorneys prefer to see as few characters as possible in the Description of Operations field. Your E&O risk increases with every word you input in that field. 

Also remember that certificate requesters may ask for wording on a certificate that is not in the policy, but it is illegal for them to require it. If a certificate requester refuses to accept a certificate that would break the two laws I quoted above, that requester should be reported to the DFS for disciplinary action. The only way to make these demands stop is to make requesters pay for them.

Lastly, the list of approved forms is a limitation on certificate requesters, not certificate issuers. The law prohibits the requester from punishing your client if the client fails to submit an unapproved form. The agent, on the other hand, can use unapproved forms all day long if (stop me if you’ve heard this before) the carrier approves them, and the forms do not change the coverage or grant any new rights.

Other than wasting an agency’s time, driving up its costs, creating tension between the agency and its clients, and hiking its E&O risk, certificates of insurance are wonderful. I have written before​ about what I think should be done with them, though this graphic sums it up better: 

​​Unfortunately, agencies have to issue these bothersome documents because their competitors do. As long as that’s the case, try not to over-complicate it: 

  • Follow your carriers’ guidelines 
  • Don’t use them to change coverage 
  • Don’t use them to invent new additional insureds, and 
  • Limit your E&O risk as much as you can. 

It’s that simple. And that difficult.
Feb 15
NY Insurance Disciplinary Actions: What's Getting Producers in Trouble These Days

Penalty by Nick Youngson CC BY-SA 3.0 Pix4free

The New York State Department of Financial Services issued its monthly insurance disciplinary action report on February 13, and it was an unusually long one – 18 pages. Big I New York members regularly contact our office with questions about whether a course of action they're considering (or that a competitor has taken) will violate the state's insurance law and regulations. Because of that, I always find it interesting to see what areas of the law DFS has focused on when taking action.

This is a summary of the disciplinary actions taken recently against resident and non-resident insurance agents and brokers, both captive and independent. When you look at the dollar amounts of fines, keep in mind that a single agency or individual may have been fined for multiple causes. For example, an agent may have been fined for being terminated by a carrier for cause and for failing to disclose that fact on a license application. The guideline to keep in mind is: The more numerous the occurrences and types of violations, the larger the fine.

With that in mind, here is a summary of the February 13, 2023 report:

One license was revoked for failure to report and disclose on renewal applications disciplinary actions taken against the agent in four other states, and for not responding to DFS investigatory letters.

One license issued to a brokerage was revoked for using an unlicensed name, commingling premium funds and operating funds, and failing to identify the premium account.

One license was revoked because the sub-licensee was indicted for grand larceny. He allegedly stole premium funds, issued fraudulent certificates of insurance, and failed to report the indictment to DFS.

There were 10 fines for failing to report disciplinary actions taken against the licensee by other states, totaling $21,500.

There were 13 fines for failing to disclose carrier terminations and disciplinary actions in other states on license applications, totaling $138,350.

Five​ fines for failure to have excess line policies stamped on time by the Excess Line Association of New York (ELANY), totaling $115,800.

Four fines for being terminated for cause by an insurance carrier, totaling $19,000. Agents were terminated for:

  • Submitting a life insurance application the proposed insured did not authorize; 
  • Falsifying insureds' prior coverage information on applications;
  • Misapplying multi-family and defensive driving course credits;
  • Inappropriately adding drivers to auto insurance applications;
  • Forging insureds' signatures on lost policy release (LPR) forms;
  • Unspecified misconduct; 
  • Enrolling individuals, some of whom were no longer breathing, in health plans without their consent; 
  • Falsifying information on auto insurance applications;
  • Incorrectly rating policies; 
  • Signing a customer's name on a life insurance application.

Two fines for failing to properly supervise employees, totaling $14,000. One employee submitted “false photographic documentation" with rental dwelling insurance applications. The other was an employee whose producer appointment was terminated for cause.

One $14,000 fine for using an unlicensed name and depositing premium funds in an account that was not identified as a premium account.

One $5,000 fine for depositing non-insurance funds in a premium account.

One sublicensee, whose brokerage was fined for failing to disclose a termination for cause, also violated the rebating law by using a personal debit card to pay premiums for two customers.

This report shows that DFS is placing emphasis on agents and brokers reporting out-of-state disciplinary actions when they happen and disclosing those actions and carrier terminations on renewal applications. It's also noteworthy that that there were multiple actions for failing to get excess line policies stamped. Big punishments were also doled out for premium account violations. These are things agents and brokers should avoid if they want to stay on the right side of the law.

One last thing: Judging from this and prior reports, it appears that the surest way to lose your license is to ignore letters from DFS. That really seems to tick them off. Don't do that.​

Feb 08
Big I NY Photo Inspection Bill Included In Governor's Budget
Governor Hochul has released her executive budget proposal, and we are thrilled to report she has included our bill to allow insurance companies to waive photo inspections. Since the bill was vetoed in November 2022, we have been negotiating with the Governor to reach an agreement, and those efforts have paid off.

The proposed budget legislation, if passed, will take effect in October of 2023, and carriers will be allowed to waive photo inspections until October 2027. 

Between now and April 1st, the state Senate and Assembly will release their own budget proposals, and then the Governor and Legislative Leaders will negotiate a final budget. Therefore, we need both houses of the legislature to include photo inspection reform in their own proposals. 

Agents are urged to contact their state lawmakers and urge them to follow suit. Additionally, we will be scheduling virtual meetings with key lawmakers from February 27th to March 3rd as part of Independent Agents Advocacy Week. Be sure to register and join us to help get this critical reform passed!​

Feb 08
Carriers Have Stopped Accepting Some Cars. Here's What You Need To Know


Major news outlets publicly reported late last month that State Farm and Progressive have stopped issuing new auto insurance policies or coverage on certain older Kia and Hyundai models. A television station in Rochester contacted Big I New York about it.  The reason given for the carriers' action was high theft rates for these vehicles – Progressive told USA Today, “In some areas, the vehicles are almost 20 times more likely to be stolen than other vehicles.”

Two Big I New York members in different parts of the state have told us this week that another major carrier has gone further. According to a producer bulletin, the carrier is:

  • Temporarily suspending the ability to quote and issue coverage for all Kia and Hyundai vehicles 
  • Suspending the ability to add or replace all Kia and Hyundai vehicles on existing policies
  • Declining to reinstate any cancelled policies that insured a Kia or Hyundai vehicle.

The bulletin cited “dramatically increased theft rates.”

Unlike the two carriers publicly identified above, this carrier is rejecting all models from these two car manufacturers. 

This situation has prompted one primary question: Can they do that? The answer is yes, but …

Yes, in that nothing in New York Insurance Law requires an insurer to provide coverage on any specific vehicle unless that vehicle is the subject of an assignment through the New York Automobile Insurance Plan (NYAIP, also known as “the assigned risk.”)

But … carriers are contractually obligated to abide by the terms and conditions of the insurance policies they sell, and that’s where things get interesting. The policies State Farm and Progressive offer in New York provide a certain amount of automatic coverage for additional or replacement vehicles. So does the policy sold by the carrier our members contacted us about. In fact, that wording is written into the Insurance Services Office (ISO) Personal Auto Policy, PP 00 01 09 18, as amended by endorsement number PP 01 79 06 22, Amendment of Policy Provisions – New York

That policy and endorsement explain how coverage applies to a “newly acquired auto.” This is a simplification of the terms and conditions, but here is a concise description:

  • For a new vehicle that is not replacing a current one, and leaving aside Comprehensive and Collision coverages for now, the vehicle automatically gets all the broadest coverages that apply to any vehicle already covered by the policy. This automatic coverage lasts for 14 days after the insured takes ownership.
  • For a new vehicle that is replacing one that was on the policy, the same coverages that applied to the old vehicle (other than Comprehensive and Collision) automatically apply to the replacement for 14 days after the insured takes ownership. 
  • Comprehensive and Collision coverages automatically apply to replacement vehicles (but not additional ones) for five calendar days after the insured takes ownership, but only if the insurer provided those coverages on the old vehicle for at least 12 months before it was replaced.

The policies I reviewed were similar, though not identical to the ISO terms and conditions. If this situatin comes up, we encourage you to read the terms and conditions of the policy your client bought to see how it applies. It seems safe to say, though, that insureds get some automatic coverage for short periods of time, whether or not the carrier likes that particular vehicle. However, the carrier has no legal obligations to provide insurance on it after those temporary periods expire.

If your client acquires one of these vehicles and their carrier has closed the door on insuring it, the best thing you can do is to inform the client and start looking for alternatives as soon as possible.
Feb 08
DFS Formally Adopts Peer-To-Peer Car Sharing Insurance Rules


The New York State Department of Financial Services (DFS)  announced today that it has formally adopted its proposed regulations on insurance for peer-to-peer car sharing arrangments. The new and amended rules took effect today.

Peer-to-peer car sharing programs match individual vehicle owners who are willing to rent their vehicles to others with willing potential renters. The arrangement is normally done via a smartphone app or website. Turo is the best-known example of a peer-to-peer car sharing service.

In 2021, the state Senate and Assembly passed and Gov. Kathy Hochul signed into law the Peer-To-Peer Car Sharing Program Act​.  Amendments were enacted ​in February 2022, and the final version of the insurance provisions took effect last June. Shortly before they took effect, DFS published emergency regulations to implement those provisions and said they intended to make them permanent. They formally proposed the changes in November. The action today adopted the proposed rules without change. 

The regulations set forth requirements for group insurance coverage for vehicle owners and renters, define the role of the excess lines market, and permit coverage exclusions on personal auto insurance policies. Be aware that your carriers are likely to add exclusions to their policies. Any of your clients who are considering renting out their cars or using one of these services while on a trip should look into the group insurance coverage provided by the platform.

Watch Big I NY's video about the regulations

Feb 03
Something Special Happened - Behind the Scenes

by Julie Furst

Something pretty special happened this week. Some meetings. Wait, what? When hearing the word 'special,' meetings rarely make even the bottom of the list. But hear me out.​​

Agent volunteers from every corner of the state headed to Albany. Big I team members came in. Let's face it, January in Albany is not 80 and sunny. But though there for business, the rooms we shared were warm from the relationships built and a shared purpose. What makes these gatherings powerful are the people and each life experience they bring with them. I felt that strongly this week.

A peek at what I saw:

nick.jpgStrategic Planning Meeting - Through small breakout discussions and a large group conversation, we worked through what an independent agency will look like in 10 years and what our association needs to do to help you. Will IAs still be relevant? Yes, we predicted, but it will be different. We drafted supports to build or expand upon. Tools and one-on-one support for tech, attracting talent, helping perpetuate to the next generation, advocating for agencies with lawmakers and carriers.

ted.jpgBoard meetings always begin with insights. Something thought-provoking to set the stage for our work together. Ted Walsh shared a pretty incredible video​ to kick us off this time. I loved the sentiment as much as I loved that this very successful man chose this message for the group. Positioned around a horseshoe table, the board is engaged in constant discussion. This agent board steers the direction of the association. I'm happy to say they're proud of what we do and wish more agencies understood all the fantastic resources available to them.


Our Legislative Meet & Greet was...magic. Filled with lawmakers, we put faces to the people we advocate for. And they listened and asked questions. When you hear the word 'insurance,' we shared, don't just think of it as all big companies; remember, our industry is full of local businesses trying to do the best for their community. We learned about the lawmakers too. Some are new in their positions, eager to understand, with hopes to make a difference. Every time I'm there, I still feel wowed looking at the capitol building.

capital.jpg View from my room


scott.jpgMeeting us for dinner were two past board chairs, Andy Kaufman and Chris Brassard. They were greeted like great friends you hadn't seen in a while, with big hugs and huge smiles. The connection clearly doesn't fade. 30 of us were gathered around three candlelit tables in the loft of a small Italian restaurant steps from the capitol. We shared stories of families and beginnings, passions, and laughter. There were stories of survival and triumph, challenges, traditions with grandkids, and adventures. We were authentically interested in each other. It showed as I looked around the room.

These people, meeting together, form our community. Your community. And when we share space, share thoughts, and build on each other's ideas, it's special.

Every week you experience different collections of people. Many different little groups through work, hobbies, family, or friends. Take a moment as often as you can to see each individual you encounter as a person, as the sum of many unique experiences, talents, and fears, and try to connect.​

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