OGC Opinion No. 06-11-16

The Office of General Counsel issued the following opinion on November 17, 2006, representing the position of the New York State Insurance Department.

Certificates of Insurance

Question Presented:

Does the Insurance Law or Insurance Department regulations require that a certificate of insurance disclose whether the policy has any deductible or self-insured retention?

Conclusion:

No. See "Analysis" below.

Facts:

The inquirer reviews certificates of insurance for a municipal agency whose contracts with vendors generally provide that deductibles and self-insured retentions are within the agency's sole discretion. Sometimes it was not requested to approve such deductible or retention and none was indicated on the certificate of insurance.

Analysis:

A certificate of insurance is often used as proof that a policy of insurance is in effect. It is merely a document used in business to summarize the essential terms, conditions, and duration of the contract of insurance that is in effect between the insured and the insurer. The certificate of insurance is not a contract, is not required by statute or regulation, and need not be filed with the Department. However, the certificate of insurance must contain information consistent with the terms of the particular insurance policy and may not confer on a certificate holder new or additional rights beyond what the insurance policy provides. Thus, if any provision in the certificate of insurance is not contained in the policy and it imposes an obligation or liability not presently existing upon an insurer, such difference would alter, expand, or modify the rights between an insured and the insurer and would constitute a policy form that must be filed with the Superintendent pursuant to N.Y. Ins. Law § 2307(b) (McKinney Supp. 2006).

N. Y. Ins. Law § 2307(b) provides in relevant part:

As a summary, the certificate of insurance may not disclose everything contained in the insurance policy. However, it may not be misleading or inaccurate or contain provisions that amend, expand, or alter the terms of the policy without authorization from the insurer and, where required, approval from this Department. Nothing would prevent the agency from requiring the insurer or insurance producer to specify whether the policy contains a deductible or self-insured retention, but the Insurance Law does not require such.

The Department has previously issued Circular Letters and opinions on this topic. The relevant Circular Letters No. 8 (1995) and No. 15 (1997) as well as the Department's Office of General Counsel opinions may be viewed at our website, www.ins.state.ny.us.

For further information you may contact Associate Jeffrey A. Stonehill at the New York City Office.