SUM Legislation - Good News/Bad News

On Dec. 17, 2012, Governor Andrew Cuomo vetoed a bill that dealt with the amount of SUM (supplementary uninsured/underinsured motorist) coverage required to be made available to consumers, but approved and signed into law another bill that dealt with the scope of SUM coverage, expanding the definition of "insured" under the SUM Endorsement to a class of individuals not previously included therein. In this article, we offer a follow-up/status report on the SUM limits bill (S.7787/A.10784) we previously reported on (see Dachs, N. and Dachs, J., " ‘SUM’ Hits the Mainstream," NYLJ, Sept. 19, 2012, p. 3), and report on and discuss for the first time, the Firefighter/Ambulance Worker bill (S.7312B/A.10080B).¹

The SUM Limits Bill

In our September 2012 article, we reported that, in an effort to ensure that individuals are fully protected by first-party supplementary insurance to the same extent as third parties, the New York State Legislature passed a bill (S.7787 and A.10784), that would have required insurers to provide SUM coverage in amounts that match the bodily injury liability coverage purchased by the insured to protect others, unless the insured formally "opts out" by rejecting such supplementary coverage completely, or elects to purchase such coverage in an amount less than the bodily injury limits. In fulfillment of our promise to keep our readers informed of the status of that bill, we take this opportunity to advise that it was vetoed by the governor, with the following message:

This bill, if enacted, would, among other things, reverse existing law by requiring consumers to pay for SUM coverage unless they affirmatively opt out of such coverage. No other optional coverage is treated this way. Consumers should be free to choose what level of SUM coverage makes sense for them.

I will not add to the financial burden already faced by New York’s consumers. The Department of Financial Services will be exploring ways to increase consumer education on the benefits of SUM coverage so consumers can make a more informed decision about whether or not to purchase it, but I will not sign into a law that places such an unacceptable choice on New Yorkers.

Firefighter/Ambulance