Congress has given the National Flood Insurance Program another temporary reprieve. Early this morning, lawmakers approved a measure that will fund the federal government through the 2019 fiscal year. It also extends the authorization for certain programs, including the NFIP, through March 23. The program lapsed at midnight when the continuing resolution passed by Congress on January 22 expired and portions of the federal government temporarily shut down.
Extension of the NFIP has been bound up in the larger dispute over funding of the federal government. Congress failed to enact a budget by the time the current fiscal year began last October 1. The government has been operating under a series of temporary funding measures (known as "continuing resolutions") since then. The NFIP's authorization to operate expired last September 30, and it has operated ever since with the same temporary authorization that applied to the rest of the goverment.
It is hoped that Congress will work out a longer term extension of the NFIP by the March 23 deadline.
Big I New York will continue to post updates on this situation as they develop.
After a lapse of almost three days, the National Flood Insurance Program (NFIP) has been temporarily reauthorized. The program and insurers participating in the Write Your Own program may resume issuing new and renewal policies and endorsements to inforce policies, effective immediately.
Extension of the NFIP has been bound up in a larger dispute over funding of the federal government. Congress failed to enact a budget by the time the current fiscal year began last October 1. The government has been operating under a series of temporary funding measures (known as "continuing resolutions") since then. The latest continuing resolution expired at midnight last Friday, causing large parts of the government to shut down. The NFIP's authorization to operate expired last September 30, and it has operated ever since with the same temporary authorization that applied to the rest of the goverment. When the continuing resolution expired last weekend, the NFIP did, too.
Congress gave final approval yesterday to a new continuing resolution that funds the government until February 8. President Donald Trump signed it later that day. The measure gives Congress and the White House a little over two weeks to resolve their differences and finalize a spending plan for the final eight months of the fiscal year. It is hoped that a long-term reauthorization of the NFIP will be part of that agreement.
Big I New York will continue to post updates on this situation as they develop.
The National Flood Insurance Program's authority to issue and renew policies will lapse at midnight tonight, barring quick action by Congress. The program is set to expire at midnight on January 19, under a measure signed by Pres. Donald Trump last month.
The NFIP's fate is tied up with the larger issue of continued funding for the federal government. Congressional leaders and the White House are reportedly in negotiations over a new funding bill that would avert a partial shutdown of the government. The program and insurers that participate in the Write Your Own program will be prohibited from issuing or renewing policies or honoring requests for increased or additional coverage, should the program lapse.
Follow Big I New York's social media channels and news alert on this website for further developments.
Read the Federal Emergency Management Agency's guidance on a potential lapse
UPDATE: FEMA Frequently Asked Questions on NFIP Lapse
If you are a Limited Liability Company (LLC) you will be interested in this. Several Big I New York members reached out to find out how they should complete the annual Certification of Compliance required by the NY cyber regulation 23 NYCRR 500. We want to let you know about a clarification we received from the Department of Financial Services (DFS) specific to LLCs.
When filing your annual Certification of Compliance with the DFS as required by the cybersecurity regulation you are asked to report who reviewed the Certification of Compliance – the Board of Directors or Senior Officer(s). Since an LLC typically does not have either we posed the question to the DFS, asking how an agency would properly respond. Here is the DFS response:
“Thanks for your inquiry. Section 500.01(m) defines “Senior Officer(s) as the senior individual or individuals (acting collectively or as a committee) responsible for the management, operations, security, information systems, compliance and/or risk of a Covered Entity, including a branch or agency of a foreign banking organization subject to this Part." Accordingly, Covered Entities will need to do a factual analysis of how this definition applies to their institutions in considering particular circumstance of their business, their data, their systems and their legal relationship to other Covered Entities.
Based on this response from the DFS, LLCs should analyze their operation and would generally check the box for “Senior Officer(s)".
Before filing the annual Certification of Compliance you should have already filed for the Limited Exemption (if you qualify). ALL covered entities (with or without the limited exemption) must file the annual Certification of Compliance NO LATER THAN February 15, 2018 (and every February 15 thereafter).
Click here for instructions on how to file the annual Certification of Compliance.
So what's next as far as deadlines for the regulation? Our chart provides a summary and you will see the next deadline is March 1, 2018 for conducting a periodic risk assessment. You should have already completed this when you were preparing your cybersecurity program and policy for the August 28, 2017 deadline, but in the event you did not you have until March 1, 2018 to assess your risk. The regulation is not specific on how to conduct the assessment and you can use any method that will measure your risk. Going forward the regulation says you must conduct “periodic" risk assessments, again not defined, so you can conduct the assessment as “reasonably necessary".
We are excited to announce a NEW member benefit that will bring your agency more exposure online and help drive new business your way! Big I NY is working in partnership with TrustedChoice.com on a targeted SEO campaign to get more insurance buyers to the website and connect them with your agencies. And as part of this partnership, for the next year our members receive an improved profile on TrustedChoice.com at no charge.
Through the More Visibility Program, agencies that are not currently Advantage Subscribers (the prime access to the top) receive a Member Plus profile will provide your agency with the following benefits:
• Your agency will show higher to consumers searching on TrustedChoice.com
• Ability to select lines of business in both personal and commercial you want to write
• Updating of contact information to get opportunities to the right producers
• Select the 2 digit NAICS codes that represent your agency's niche markets
• The ability to add a custom 'about us' statement
• Access to your agency Dashboard to see and track the referrals you have received
These enhanced capabilities will enable your agency to start getting only the referrals you want from insurance buyers that you like.
Activate Your Free Upgraded Profile Here
Watch: Step by Step Video Guide
The New York State Department of Financial Services last week cautioned providers of cell phone insurance and service contracts to avoid wrongful sales practices. The January 3 circular letter, addressed to all property-casualty insurers, registered service contract providers and licensed insurance producers, discussed a number of "improper practices" the department has identified in the market. Specifically, the letter warned against:
- Tying the sale of cell phone insurance with the sale of service contracts and other non-insurance benefits
- Offering the insurance to wireless carriers and retailers who will in turn offer it for free to consumers who buy an extended warranty or service contract.
- Rounding premiums up or down to achieve a "marketable price," where that deviates from filed rates.
- Compensating unlicensed employees of producers for the sale of insurance
- Not complying with cancellation and nonrenewal requirements
- Using unlicensed trade or assumed names in brochures and other written materials
- Failing to include insurers' full names and home office locations in advertisements
- Failing to provide consumers with required disclosure notices pertaining to the claims filing process, premium, deductible amounts, limits, and producer compensation
The department admonished anyone involved in these practices to "promptly take all necessary steps to come into compliance."
Read the department's letter
Vincent A. Alba
1925 – 2017
(Written by IIABSC)
Recently, we lost one of our most beloved and dedicated professionals of all times. After serving in the US Marine Corps during WW ll, Vinny Alba spent his entire career in the insurance industry including many years doing volunteer work for the Big ‘I’ associations. His biography would go on for pages, but here are some highlights……..
Vinny started in 1946 with the Whitehill Agency in NYC and in 1956 progressed to underwriting and marketing positions with Springfield and then Reliance Insurance Companies. He opened his own insurance agency in 1969 from his home in East Northport. Much later, he joined the MRW Group in Huntington as a vice president until he retired.
Vinny joined the board of directors of the Independent Insurance Agents Association of Suffolk County in the late 60’s and served as its president in 1986-1987. He remained active not only with the Suffolk Big ‘I’ association, but became widely respected through his volunteerism with our Big ‘I’ state (IIABNY) and national (IIABA) associations with his tireless efforts in legislation matters and InsurPac collections. Some of the deserving honors Vinny received over the years include:
- IIABNY Distinguished Award (for a record of fund raising for InsurPac) - 2004
- The Vincent A. Alba Lifetime Achievement Award, Presented by IIAB Suffolk in 2005
IIABNY board Resolution of Appreciation and Commendation for InsurPAC - 2005
- ‘Insurance Person of the Year’ Presented by TriCounty IIAA in 2007
- James R. Studgeon Award, from Downstate Insurance Associations Council, 2007
- Barney Burns Award, one of the highest awards presented by Big ‘I’ National, for outstanding fund-raising efforts for InsurPAC. - Presented at the National Legislative Conference in DC in 2008.
After a reluctant retirement, Vinny and his wife Teddi moved to Georgia to live with their son Ted and his wife Sheryl. Determined to stay active, Vinny built beautiful miniature violins for a hobby and enjoyed life to its fullest until he passed peacefully on December 12th at the age of 92 from heart failure.
While we mourn those who have passed on, we especially remember those who contributed so much for causes and the love of people. Vinny left an indelible impression on so many of us and for that we will remember him fondly with for a long time. At the family’s suggestion, donations in Vinny’s name can go to the Semper Fi Fund.
The National Flood Insurance Program will not lapse on December 22. Both houses of Congress yesterday passed an emergency measure funding the federal government through January 19. That bill also applies to the authority of the NFIP to enter into new contracts. President Donald Trump is expected to sign the bill into law today. Enactment of the bill is necessary to prevent parts of the federal government from shutting down at midnight tonight.
Passage of the bill means that the NFIP will continue to operate as normal for the next four weeks while Congress works on a longer-term extension.
The New York State Department of Financial Services has formally adopted a change, requested by Big I New York, that will make it unnecessary for some insurance agencies to provide customer privacy notices. Agencies that share customer information only in very limited circumstances and whose information sharing practices do not change will not have to provide the notices every year.
Previously, New York Insurance Regulation 169 required all licensees (carriers, agents, brokers, etc.) to annually provide to current customers "a clear and conspicuous notice that accurately reflects the licensee's privacy policies and practices." The federal Gramm-Leach-Bliley Act required all state insurance regulators to implement these requirements. However, a law enacted by Congress and signed by President Barack Obama in 2015 eliminated the requirement for many financial institutions to provide the annual notices under certain circumstances. The National Association of Insurance Commissioners proposed regulatory changes for states to implement. Big I New York urged the NYSDFS to adopt them, and the department proposed a rule change on August 30 to do just that. The department announced today that it has formally adopted the change.
Under the new rules, an insurance agency is exempt from having to provide annual privacy notices if both of the following conditions are met:
- The agency only shares non-public personal information with nonaffiliated third parties under one of the existing exemptions from which consumers cannot opt out (such as obtaining insurance quotes on the consumer's behalf)
- The agency has not changed its privacy policies and practices since providing its most recent privacy notice
The new exemption can be a huge time and cost-saver for agencies who share little or no customer information with third parties. It is effective December 20, 2017.
Read the DFS announcement
With the National Flood Insurance Program's (NFIP) authority to operate scheduled to expire at the end of the day Friday, the Federal Emergency Management Agency (FEMA) has issued guidance to insurers that participate in the Write Your Own (WYO) program. Unless Congress extends the NFIP before then, starting on Saturday the agency will be unable to honor requests for new coverage, increases in coverage, or renewals.
Applications and requests for increased coverage dated before December 23 will be honored if the insurer receives the application or request and the premium payment within 10 days of the application/request date. For example, the insurer would be able to issue a new policy based on an application dated December 21 if it receives the application and the premium by December 31. It would not be able to issue the policy if it receives the application and payment on or after January 1.
Renewals that the insurer offered before the lapse will be issued if the insurer receives premium payment within the 30-day renewal grace period. Renewals cannot be issued if the insurer receives payment later than that.
Claims made against new policies and renewals issued before the lapse will be honored as normal.
If and when Congress reathorizes the program, insurers can issue policies effective as of the date they receive payments (if reathorization is retroactive to the date of the lapse.) Other rules may apply if the reauthorization is not retroactive.
Check the Big I New York website for updates on the fate of the NFIP.
Read the FEMA guidance