Legislative Update

The Legislature this week ratified new lines for New York’s Congressional and state legislative districts. The once in a decade process marked the first time that Democrats in the State Legislature held complete control over the reapportionment process. Preliminary indications point to Congressional Democrats having the opportunity to pick up three seats in New York.

Under the newly adopted State Senate lines, New York City will gain one seat in Brooklyn and Queens. These new lines largely reflect the growth in population in New York City over the last decade.

Two bills have recently been introduced on long-term care insurance. One requires long-term care insurance rate increases may not exceed 33% in a three-year period, and the other changes the standard of review for long-term care insurance premium rates and requires additional disclosures and notices.

Regulatory Update

The New York Senate confirmed Adrienne Harris as Superintendent of the Department of Financial Services (“DFS”). Ms. Harris has been serving as Acting Superintendent since the departure of her predecessor, Linda Lacewell, in August 2021. Superintendent Harris stated, “I am honored to serve as the Superintendent of the Department of Financial Services. As the first African American woman to lead DFS, I am personally committed to working with all stakeholders to build a robust, fair and sustainable financial system, creating a better economic future for all New Yorkers."

Superintendent Harris began her career as an Associate at Sullivan and Cromwell LLP in New York City before accepting a position at the U.S. Department of the Treasury under President Obama. Her work ranged from financial reform efforts to identifying solutions to the student loan crisis, analyzing the nexus between foreign investment and national security, and working to promote financial inclusion and health in communities throughout the country. Following her time at the Treasury Department, Superintendent Harris joined the White House, where she was appointed as Special Assistant to the President for Economic Policy, as part of the National Economic Council. In this role, Superintendent Harris managed the financial services portfolio, which included developing and executing strategies for financial reform and the implementation of Dodd-Frank, consumer protections for the American public, cybersecurity and housing finance reform priorities.

After leaving the White House in January 2017, Superintendent Harris went on to serve as General Counsel and Chief Business Officer at States Title, Inc. (now DOMA). Prior to being nominated, Superintendent Harris also served as a Professor and as Faculty Co-Director at the Gerald R. Ford School of Public Policy's Center on Finance, Law and Policy at the University of Michigan, as well as a Senior Advisor at the Brunswick Group in Washington, D.C.

We expect to see Superintendent Harris to begin to make additional appointments at DFS. As the head of the enforcement division is vacant, we would expect to see that position filled in short order.

In one of her first significant enforcement actions against a life insurer, last month, DFS entered into a consent order with Columbian Mutual Life Insurance Company for failing to comply with New York law governing unclaimed life insurance proceeds. Columbian Mutual will pay approximately $7.83 million in restitution to New York consumers, plus $3 million in penalties to New York State.

DFS's investigation found that Columbian Mutual failed to cross-check all policies against Social Security Administration Death Master File records and delayed outreach or failed to contact beneficiaries. In addition, Columbian Mutual failed to transfer death benefits to New York State as abandoned property, as required by the law, when unable to locate beneficiaries.  

DFS has been somewhat quiet pending the confirmation of Superintendent Harris. Now that she has been confirmed, we expect to see more activity coming from the department.