NEW YORK, Aug. 15 LAWFUEL – The Legal Newswire — Quadrino Schwartz urged the New York Insurance Commissioner to act as quickly as possible to
proceed with a rulemaking process to implement a rule outlawing
discretionary clauses in group health, life and disability policies.
A series of regional law firms were asked to join with Quadrino
Schwartz in sending a letter to the Insurance Commissioner. The response
was impressive, and a formal letter signing ceremony was conducted at the
New York City Offices of Quadrino Schwartz.
Discretionary clauses have been used by group insurers as a way of
shielding insurance companies from scrutiny by a federal judge if a lawsuit is filed challenging the decision to deny an insurance claim. The clauses
have come into play when the federal ERISA law is used as the guiding body of law for claims under group insurance policies. Several States acted to ban the clauses, including New York, after the National Association of
Insurance Commissioners urged such action. New York pulled back from its
original approach of issuing an informal Circulation Letter and decided to revoke the Letter and proceed instead with formal rulemaking, the process used to issue formal regulations.
Since the shift in approach by New York State, however, no action has
been forthcoming. “The impact of these discretionary clauses has been
devastating to families throughout New York and the country”, said Mr.
Hack, the attorney at Quadrino Schwartz who led the effort to bring the
regional law firms together to sign the letter. The letter seeks to
convince the New York Insurance Commissioner that with each passing month
the number of victims of these of these clauses mounts and that this matter should be given priority within the Insurance Department. “We hope to see prompt action so that this long and difficult period in history of the law can be closed,” said Mr. Hack.
About Quadrino Schwartz
Quadrino Schwartz is a nationally recognized firm that obtains
recoveries from insurance companies on behalf of policyholders. The firm’s Insurance Law group provides services ranging from claims management and investigations through and including litigation, settlement, trials and appeals.
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