The Office of General Counsel issued the following opinion on April 7, 2005, representing the position of the New York State Insurance Department.
Re: Supplemental Spousal Liability Coverage And For-Hire Vehicle Policies
Questions Presented
1) Must an insurer offer supplemental spousal liability (SSL) coverage on a policy covering a for-hire vehicle that is subject to Article 8 of the New York Vehicle and Traffic Law?
2) If an insurer issues one commercial automobile policy that provides liability insurance for both vehicles subject to Article 6 of the New York Vehicle and Traffic Law and vehicles that are not subject to Article 6, must the insurer provide a schedule of vehicles for which SSL coverage is provided or may the insurer issue an endorsement removing the spousal exclusion from the commercial automobile policy and specify that this endorsement applies only to vehicles subject to Article 6?
Conclusions
1) An insurer is not required to offer SSL coverage on a policy covering a for-hire vehicle that is subject to Article 8 of the New York Vehicle and Traffic Law.
2) If an insurer issues one commercial automobile policy that provides liability insurance for both vehicles subject to Article 6 of the New York Vehicle and Traffic Law and vehicles that are not subject to Article 6, an insurer may issue such an endorsement specifying that the endorsement applies only to vehicles subject to Article 6 so long as the endorsement is clear and not misleading.
Facts
No facts were provided. A general question was proposed regarding supplemental spousal liability (SSL) insurance coverage.
Analysis
N.Y. Ins. Law § 3420(g) (McKinney Supp. 2005) generally bars coverage under a liability policy for claims brought by a spouse against the other spouse unless the policy expressly provides coverage for such claims. However, Section 3420(g) was amended by Chapter 584 of the Laws of 2002 to provide, in pertinent part:
(g) No policy or contract shall be deemed to insure against any liability of an insured because of death of or injuries to his or her spouse or because of injury to, or destruction of property of his or her spouse unless express provision relating specifically thereto is included in the policy as provided in paragraphs one and two of this subsection. This exclusion shall apply only where the injured spouse, to be entitled to recover, must prove the culpable conduct of the insured spouse.
(1) Upon written request of an insured, and upon payment of a reason- able premium established in accordance with article twenty-three of this chapter, an insurer issuing or delivering any policy that satisfies the requirements of article six of the vehicle and traffic law shall provide coverage against liability of an insured because of death of or injuries to his or her spouse up to the liability insurance limits provided under such policy even where the injured spouse, to be entitled to recover, must prove the culpable conduct of the insured spouse. Such insurance coverage shall be known as "supplemental spousal liability insurance."
Section 3420(g) now requires an insurer to provide such coverage to an insured under a motor vehicle policy that satisfies the requirements of Article 6 of the Vehicle and Traffic Law (VTL) concerning financial responsibility, where the insured requests the coverage. However, for-hire vehicles are subject to Article 8, not Article 6, of the VTL. Accordingly, SSL coverage is not required to be offered, although an insurer may voluntarily offer such coverage.
It was also inquired as to whether, if an insurer issues one commercial automobile policy that provides liability insurance for both vehicles subject to Article 6 of the New York Vehicle and Traffic Law and vehicles that are not subject to Article 6, the insurer may issue an endorsement specifying that the endorsement applies only to vehicles subject to Article 6. As long as the endorsement is clear and not misleading, such an endorsement would be approved by the Department for use by an insurer.
For further information you may contact Principal Attorney Paul A. Zuckerman at the New York City Office.