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Spotlight
Senior Vice
President Gerry McCarthy brings extensive
experience in both insurance litigation and
pro-active, resolution-oriented claims management
to the clients of Allied North America.
Responsible for claims processing in our Jericho,
New York office, Gerry’s leadership ensures that
his team of professionals will provide superior
service throughout the claims and litigation
processes. A trial lawyer who has successfully
defended clients in construction accident, product
liability, professional indemnity, Dram Shop
liability, municipal liability, premises liability
and insurance coverage cases, Gerry is equally
adept at negotiating and settling claim disputes
before they reach the litigation stage. Prior to
joining Allied, he was co-managing attorney of the
Construction Practice group at Jones Hirsch
Connors & Bull, P.C., an insurance defense
litigation law firm, after more than a decade with
the AIG Construction Risk Management Division.
Gerry was admitted to the New York State Bar in
1985, initially practicing civil and commercial
litigation with an emphasis on
construction.
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Is The Cavalry
Coming To The Rescue?
Gerry McCarthy
On
June 20, 2007, the New York State Senate passed a
Bill amending the New York Insurance Law, adding a
new section (3451) that will require insurers to
show "material prejudice" before disclaiming for
late notice.
Highlights of the Senate
Bill:
The statute only applies to
property and casualty policies issued by admitted
insurers. However, if it were to become law, the
Courts may be hard pressed not to apply the
mandate to excess and surplus lines carriers, as
the Bill evidences a strong public policy in favor
of requiring a showing of prejudice;
The
statute creates a rebuttable presumption that the
insurer has not been prejudiced if it receives
notice from a source other than the named insured.
Currently, an insurer may assert late notice if
the notice did not actually come from the named
insured;
The statute will apply
prospectively - that is, it applies to "all
insurance contracts executed, issued, reissued or
renewed on or after" the effective date of the
law.
The Bill was sent to the State
Assembly for consideration, and was referred to
the Judiciary Committee for review. If passed by
the Assembly, it is then sent to the Governor for
approval. Once signed by the Governor, the Bill
becomes law.
The significance of this
legislation for New York insureds cannot be
overstated. New York is virtually the only state
that does not require an insurer to demonstrate
that it has been prejudiced by late notice before
disclaiming. There have been thousands upon
thousands of these cases over the years where
insurers have disclaimed coverage to their
insureds for late notice. In the vast majority of
these circumstances, the insurer has not suffered
a scintilla of prejudice, leaving the insureds
to fend for themselves, uninsured. The
inequity of this result is no doubt a driving
force behind the current Bill.
We urge
all of our clients to contact their State
Legislators to press for passage of the
legislation. You can do this by clicking on the NY
State Assembly Image below.
We will closely
follow this Bill as it progresses through the
corridors of Albany and provide updates
accordingly.
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