WASHINGTON, D.C., JUNE 3, 2014 - Gary Henning, Northeast region vice president for the American Insurance Association (AIA), issued a statement today urging New York legislators to oppose A. 8745, the Construction Insurance Transparency Act. The legislation would require insurers to provide ten years` worth of in-depth claims data regarding New York`s Scaffold Law - Section 240 of the Labor Law - for commercial general liability insurance claims to the Department of Financial Services (DFS). New York is the last state in the country with a strict liability standard in instances where a contractor is at all at fault, regardless of any negligence on the part of the injured worker.
Mr. Henning`s Statement Follows:
"AIA strongly opposes A.8745, the Construction Insurance Transparency Act. This legislation is unnecessary and does nothing more than divert attention from the very real problem of the unacceptable societal costs of the strict liability standard placed on contractors by Section 240 of New York`s Labor Law.
"Section 240 of the Labor Law is a serious problem. The strict liability standard it places on contractors if the contractor is the least bit at-fault has caused what has become a crisis in the New York insurance market. New York is the only state with this type of liability standard. The Construction Insurance Transparency Act would not address this problem. Instead the bill would simply divert attention from the real problems. Aggregate claims data has already been presented to the legislature which shows that claims costs in New York for gravity-related claims risk are much higher than exposures without the risk. The arduous task of compiling the voluminous information required under A. 8745 would not provide new or useful insights.
"The New York construction liability market continues to remain in real crisis and will not improve unless a comparative negligence standard is introduced, the standard which exists for most torts in New York and throughout the country. The Construction Insurance Transparency Act only makes the situations worse, highlighting the need for real reform. Therefore, AIA strongly urges legislators to oppose A. 8745 and adopt measures that would actually solve the real problem--Section 240 of New York`s Labor Law."
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Source: American Insurance Association via GlobeNewswire