| The past legislative session, which adjourned in late June of this year, saw no shortage of challenges for independent agents and our customers. But Big I NY members rose to the challenge and rallied to help defeat legislation that would have dramatically increased liability for businesses, including agencies and brokerages, and raised the cost of insurance.
The Issue: Preventing a Litigation Explosion The proposed legislation, S.2407-C/A.679-C, would dramatically expand the definition of unfair business practices to include “unfair, deceptive, and abusive" practices. The new definitions of such conduct are extremely broad, relying heavily on subjective standards which are certain to result in a wave of litigation against businesses of all types. For example, take the following provision, which defines just one of the three prohibited practices (subjective language is bolded):
(1) For the purposes of this section, an act or practice is unfair when: (i) it causes or is likely to cause substantial injury, the injury is not reasonably avoidable, and the injury is not outweighed by countervailing benefits; or (ii) it takes unreasonable advantage of the inability of a person to protect his or her interests because of the person's infirmity or illiteracy or inability to understand the language of an agreement.
Who decides whether a practice is likely to cause an injury? How will it be determined whether a potential injury was substantial? Who judges whether an injury was reasonably avoidable or not? As if that wasn't enough, the bill would allow private lawsuits, including class actions, by any person, business, or organization; under the current law, enforcement rests solely with the Attorney General. It also creates extremely lucrative incentives for consumers and their attorneys to file such suits. The bill guarantees a minimum of $2,000 in damages per violation, as well as full attorneys' fees and costs. For independent agents and brokers, who provide trusted advice on a range of insurance products to customers on a daily basis, the consequences of this bill are deeply concerning. Imagine, for example, a customer suffers an uninsured loss. Faced with financial hardship, and encouraged by relentless advertising from personal injury attorneys, they sue their insurance agent and carrier, alleging they are the victim of unfair business practices because they didn't understand the insurance policy they bought. The potential for abusive lawsuits is enormous. Virtually every business in the state – our clients - similarly face increased legal exposure. How does a business avoid being sued when nearly everything can be construed as an actionable violation of the business law? And what does that do to the cost and availability of commercial insurance, as well as E&O insurance? The picture isn't pretty. Agents Fight Back: The Power of Grassroots Action At the first sign this bill was moving, Big I NY leapt into action. Our government relations team in Albany received notice that the bill was scheduled for a vote in the Senate Consumer Protection Committee, and immediately began an aggressive phone campaign. Big I NY members began calling the committee chair, urging him not to put the bill up for a vote. Reports from another lobbyist, who was in the Senator's office at the time of the call-in campaign, reported that the phones were “ringing off the hook." Government Relations staff and our lobbyists met with key committee members, followed by the committee chair, where his staff confirmed they were surprised by the number of concerned calls they received from agents. Unfortunately, the news was bad: the bill would still be brought to a vote. The next day, it passed the committee.
Undeterred, we shifted the campaign to a new target, the Senate Majority Leader. The goal: keep the bill from being brought to a vote by the full Senate. We accelerated the call-in campaign, with members sharing the call to action with their colleagues and employees. In the course of just a few days, agents made hundreds of concerned phone calls. A subsequent meeting with the leader's senior staff revealed that we had cut through the noise of the late-session chaos, and our message was breaking through. They too were caught off guard by the volume of opposition from agents.
With only a few weeks remaining in session, the campaign continued in Albany and across the state, with Big I NY members calling their own Senators while the Government Relations team met with rank-and-file legislators in the Capitol. On June 21st, it was clear our efforts had paid off: the gavel fell and Senate adjourned without bringing the bill to a vote. Lessons Learned: This is far from the complete story; for the sake of brevity, the myriad of meetings, memos, letters, and collaboration with other insurance and business groups are not discussed in detail. Those activities are routine. What makes this story exceptional is the extent to which Big I NY members rose to the challenge and had a decisive impact. So what can we take from this example? - Mass engagement makes the difference. Lawmakers get phone calls and emails about bills all the time, and it's difficult to cut through the noise. When they get a few, a staff member makes a note. When they get hundreds, they pay attention. Big I NY members logged over four hundred phone calls during this campaign. The consistent theme we heard from the targets of the call-in campaign was surprise – and awareness of our concerns.
- Independent agents are in it for their customers. Many, if not most, of our issues are issues that impact our customers. Being politically engaged with Big I NY is an important part of being your customers' trusted advisor and advocate. Many of your customers would be seriously impacted had this bill passed – they should know that their agent is looking out for them in Albany.
- The benefits are greater than stopping one bill. Sustained grassroots engagement builds our brand and helps all of our issues. It makes lawmakers understand we're paying attention, we're in their districts, and we're willing to fight for what we believe in.
Want to Get Involved? There are many ways you can support our efforts: - Keep an eye on your inbox – during legislative session (January-June) we send out action alerts with easy ways to engage your legislators on key issues (such as the call-in campaign)
- Get involved in your local association! Our local Big I associations are often the conduit for grassroots legislative work, both in the community and in Albany.
- Want to get even more hands on? We're recruiting members for our Grassroots Subcommittee, which focuses on identifying and executing grassroots tactics. Email Scott Hobson for more information.
- Contribute to IAPAC, our state political action committee.
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