Curiale Legislative Aims: Would Mandate That All Health Insurers Write Small Groups, Control Life Sales Practices, Enact NAIC Accreditation Models.

• Position: [ON MY RADAR]

New York Insurance Superintendent Salvatore R. Curiale told members of the Assembly Insurance Committee on March IS that the department is seeking enactment of a new "all markets" bill to require that all health insurers in the state participate in the individual and small group marketplace. The committee is chaired by Alexander "Pete" Grannis (D.-N.Y.).

The proposal is a sequel to the legislation enacted last year mandating community-rating and open-enrollment for all health insurers. Under the statute all insurers selling health coverage to small groups must accept all applicants regardless of age, sex, occupation or previous medical history. However, the existing law gives commercial health insurance companies the option of selling only to large groups and the Superintendent's proposal would vacate that option.

The Superintendent also discussed with the Assembly Insurance Committee the problem of "deceptive sales practices by life insurers." Curiale has been engaged in an effort to more closely supervise sales practices and he told the legislators about a directive he sent in January to all life insurers in the state demanding that they review internal procedures related to their sales forces and report their findings to the department by March 31. The decision to monitor these activities by life insurers was induced by a nationwide uproar over tactics by Metropolitan Life and its sales of a product to nurses, purportedly as a retirement plan but actually ordinary life. Recently Metropolitan Life agreed, under the prompting of the National Association of Insurance Commissioners, agreed to a fine of $20 million plus restitution to policyholders who were taken in by the sales scam. The fine would be divided up by states, evidently based on the level of sales of this product in each.

New York which is said to have 6,400 residents who were subject to misleading sales approaches, would get a $2.7 million share of the fine pie, and Florida, where the scam presumably was spawned, would get $4.3 million. In addition to the fine, the cost of restitution has been placed at $30 million.

Another subject discussed by the Superintendent related to the on-going effort to protect the market for homeowners said to be endangered by the fear of some insurers to write coastal type properties in certain windstorm exposed communities.

In his presentation, Curiale said that the insurers' reluctance developed in the wake of Hurricane Andrew. The Insurance...