New York Laws
Article 26 - Unfair Claim Settlement Practices; Other Misconduct; Discrimination
2601 - Unfair Claim Settlement Practices; Penalties.

(1) knowingly misrepresenting to claimants pertinent facts or policy
provisions relating to coverages at issue;
(2) failing to acknowledge with reasonable promptness pertinent
communications as to claims arising under its policies;
(3) failing to adopt and implement reasonable standards for the prompt
investigation of claims arising under its policies;
(4) not attempting in good faith to effectuate prompt, fair and
equitable settlements of claims submitted in which liability has become
reasonably clear, except where there is a reasonable basis supported by
specific information available for review by the department that the
claimant has caused the loss to occur by arson. After receiving a
properly executed proof of loss, the insurer shall advise the claimant
of acceptance or denial of the claim within thirty working days;
(5) compelling policyholders to institute suits to recover amounts due
under its policies by offering substantially less than the amounts
ultimately recovered in suits brought by them;
(6) failing to promptly disclose coverage pursuant to subsection (d)
or subparagraph (A) of paragraph two of subsection (f) of section three
thousand four hundred twenty of this chapter;
(7) submitting reasonably rendered claims to the independent dispute
resolution process established under article six of the financial
services law; or
(8) artificially deflating or otherwise lowering cost data used for
adjusted claims, or using cost data that is not appropriate for the
region of the state where the loss occurred; this shall include but is
not limited to claims adjusted by a person issued a temporary permit
pursuant to subsection (n) of section two thousand one hundred eight of
this chapter.
(b) Evidence as to numbers and types of complaints to the department
against an insurer and as to the department's complaint experience with
other insurers writing similar lines of insurance shall be admissible in
evidence in any administrative or judicial proceeding under this section
or article twenty-four or seventy-four of this chapter, but no insurer
shall be deemed in violation of this section solely by reason of the
numbers and types of such complaints.
(c) If it is found, after notice and an opportunity to be heard, that
an insurer has violated this section, each instance of noncompliance
with subsection (a) hereof may be treated as a separate violation of
this section for purposes of ordering a monetary penalty pursuant to
subsection (b) of section one hundred nine of this chapter. A violation
of this section shall not be a misdemeanor.