Insurance Circular Letter No. 1 (2020)

January 16, 2020


All Authorized Property/Casualty Insurers and Licensed Insurance Producers


Implementation of the Driver’s License Access and Privacy Act or “Green Light Law”

STATUTORY REFERENCES: Insurance Law §§ 2303, 2321 and 2802 and Articles 23 and 26; Vehicle and Traffic Law § 502(1); and Chapter 37 of the Laws of 2019

I. Purpose

The purpose of this circular letter is to inform all authorized property/casualty insurers and licensed insurance producers (collectively, “Addressees”) that the Department of Financial Services (“Department”) expects Addressees to cooperate fully with the intent of the Driver’s License Access and Privacy Act, which is also known as the “Green Light Law.”

II. Discussion

Governor Andrew M. Cuomo signed the Green Light Law into law on June 17, 2019 as Chapter 37 of the Laws of 2019. Chapter 37 amended Vehicle and Traffic Law § 502(1) to allow all New Yorkers 16-years-of-age and older to apply for a standard, not for federal purpose, non-commercial driver license or learner permit, regardless of their citizenship or lawful status in the United States. According to the legislative sponsor’s memo, the Green Light Law was enacted to address “the long-held need by undocumented immigrants and workers to secure driving privileges not only to get back and forth to work but to conduct tasks in their personal lives like going to doctor visits and taking their children to school.” The Green Light Law took effect in December 2019.

The Department has taken action over the past years to prohibit unfair and discriminatory practices in the setting of motor vehicle insurance rates. For example, in December 2017, the Department announced a final regulation limiting insurers’ use of an individual’s occupational status or educational level attained as factors in setting motor vehicle rates. Further, an insurer may not reject a motor vehicle insurance applicant who possesses a New York driver’s license solely because the applicant has not owned or insured a vehicle during the prior 39 months. New York Insurance Law includes other important protections to guard against discriminatory or unfair practices. For example, the Department issued industry guidance in January 2019 to ensure that an insurers’ use of external data, algorithms, or predictive models for underwriting purposes does not result in discrimination against protected classes.

As you are aware, the Department promotes and supports responsible underwriting innovations to accurately rate risks and determine appropriate premiums. The Department has successfully enabled a number of insurance providers in New York to implement usage-based insurance or telematics programs that can help customize rates based on an individual’s driving experience.

All Addressees are on notice that holders of learner’s permits and licenses obtained under the Green Light Law (“Licensed Person”) should not be subjected to any unfairly discriminatory practices when they seek motor vehicle insurance. An insurer should:

  • recognize that a Licensed Person may have a driving history in his or her place of origin that could be considered for underwriting purposes;
  • not deny, due to his or her citizenship or lawful status in the United States, a Licensed Person’s opportunity to participate in the many usage-based insurance or telematics programs that the Department has approved for insurers authorized in New York;
  • eliminate any bias, disparate impact or factor usage based on an insured’s citizenship or lawful status in the United States in any data sources, algorithms, or predictive models relied upon for underwriting or rating purposes or otherwise;
  • recognize that Insurance Law § 2802 prohibits any adverse underwriting or rating action for personal lines insurance due to a Licensed Person having an absence of credit information; and
  • recognize that Insurance Law § 2303 does not permit unfair discrimination in the making of rates.

None of the above limits the Addressees’ obligations to abide by other protections afforded under the Insurance Law and regulations promulgated thereunder (“Insurance Law”) or any other law. For example, Insurance Law Article 26 prohibits a motor vehicle insurer from refusing to issue, renew, or sell a policy because of the applicant’s or insured’s race, creed, color, national origin, disability, sex, marital status, or advanced age. The violation of those obligations may result in fines or other disciplinary actions, but the Department encourages Addressees to do more than the minimum required.

III. Conclusion

The Department supports the purpose of the Green Light Law and expects that no Addressee will undercut that purpose by abrogating its obligations under the Insurance Law, Vehicle and Traffic Law, or any other law.

In furtherance of that purpose, the Department reserves the right to audit and examine an insurer’s underwriting criteria, programs, records, algorithms, and models, including within the scope of regular market conduct examinations, and to take disciplinary action, including fines, revocation and suspension of a license, and require the withdrawal and suspension of rates pursuant to Insurance Law § 2321.

Please direct any questions regarding this circular letter to Holford Marshall, Supervising Insurance Examiner, Property & Casualty Bureau, New York State Department of Financial Services, One State Street, New York, New York 10004 or by email at [email protected].





Stephen Doody
Deputy Superintendent – Property & Casualty Insurance