Apr 19, 2019

PIANY bill to repeal anti-arson application requirement gets state Senate sponsor

Sen. James Sanders Jr., D-10, recently sponsored the Senate companion bill (S.5126) to PIANY’s Assembly bill (A.1167), which would repeal the anti-arson application requirement in New York City. This is one of PIANY’s legislative priorities for this legislative season. Currently, New York City is the only municipality in the state that still requires the anti-arson application to be completed. PIANY successfully worked to remove the anti-arson application requirements in Buffalo and Rochester in 2017.

In the late 1970s, increased arson activity in some major cities prompted the state Legislature to create the law to require people who want to cover their property from damage caused by fire or explosions to complete this application annually; the implications associated with noncompliance are severe. Many insureds forget, or simply fail, to complete the form in time—not due to fraudulent activity, but an administrative lapse by the property owner. When an agent, broker or insurer fails to receive the completed and signed application, the law requires the insurer to cancel the policy, which creates a significant unnecessary expense for the client.

The anti-arson application has been irrelevant since legislation to require insurers to file plans with the New York State Department of Financial Services regarding how they intend to detect, investigate and prevent fraudulent insurance activities was enacted in 1996. Since then, insurers have engaged in fraud prevention methods that are far more effective than the application form.