Section 3420. Liability insurance; standard provisions; right of injured person

(a) No policy or contract insuring against liability for  injury  to  person,  except  as  provided  in subsection (g) of this section, or
  against liability for injury to, or destruction of,  property  shall  be
  issued  or  delivered in this state, unless it contains in substance the
  following provisions or provisions that are equally or more favorable to
  the insured and to judgment creditors so far as such  provisions  relate
  to judgment creditors:
    (1)  A  provision  that  the  insolvency  or  bankruptcy of the person
  insured, or the insolvency of the insured's estate,  shall  not  release
  the  insurer  from  the  payment of damages for injury sustained or loss
  occasioned during the life of and within the coverage of such policy  or
  contract.
    (2)  A  provision  that  in  case  judgment against the insured or the
  insured's personal  representative  in  an  action  brought  to  recover
  damages  for  injury  sustained  or loss or damage occasioned during the
  life  of  the  policy  or  contract  shall  remain  unsatisfied  at  the
  expiration  of  thirty  days  from  the  serving  of  notice of entry of
  judgment upon the attorney for the insured, or  upon  the  insured,  and
  upon  the  insurer,  then an action may, except during a stay or limited
  stay of execution against the insured on such  judgment,  be  maintained
  against  the  insurer  under the terms of the policy or contract for the
  amount of such judgment not exceeding the amount of the applicable limit
  of coverage under such policy or contract.
    (3) A provision that notice given by or on behalf of the  insured,  or
  written  notice  by  or  on  behalf  of  the injured person or any other
  claimant, to any licensed agent of  the  insurer  in  this  state,  with
  particulars  sufficient  to identify the insured, shall be deemed notice
  to the insurer.
    (4) A provision that failure to give any notice required to  be  given
  by  such  policy within the time prescribed therein shall not invalidate
  any claim made by the insured, an injured person or any  other  claimant
  if  it  shall be shown not to have been reasonably possible to give such
  notice within the prescribed time and that notice was given as  soon  as
  was reasonably possible thereafter.
    (5)  A  provision that failure to give any notice required to be given
  by such policy within the time prescribed therein shall  not  invalidate
  any  claim  made  by  the insured, injured person or any other claimant,
  unless the failure to provide timely notice has prejudiced the  insurer,
  except as provided in paragraph four of this subsection. With respect to
  a  claims-made  policy,  however,  the policy may provide that the claim
  shall be made during the policy period,  any  renewal  thereof,  or  any
  extended  reporting period, except as provided in paragraph four of this
  subsection. As used in this paragraph, the  terms  "claims-made  policy"
  and  "extended reporting period" shall have their respective meanings as
  provided in a regulation promulgated by the superintendent.
    (6) A provision that, with respect to a claim arising out of death  or
  personal  injury  of  any  person, if the insurer disclaims liability or
  denies coverage based upon the failure to provide  timely  notice,  then
  the  injured  person  or  other claimant may maintain an action directly
  against such insurer, in  which  the  sole  question  is  the  insurer's
  disclaimer  or  denial  based  on  the failure to provide timely notice,
  unless within sixty  days  following  such  disclaimer  or  denial,  the
  insured or the insurer: (A) initiates an action to declare the rights of
  the parties under the insurance policy; and (B) names the injured person
  or other claimant as a party to the action.
    (b)  Subject  to  the  limitations  and conditions of paragraph two of
  subsection (a) of this section, an  action  may  be  maintained  by  the

  following  persons  against  the  insurer upon any policy or contract of
  liability insurance that is governed by such paragraph, to  recover  the
  amount of a judgment against the insured or his personal representative:
    (1)  any person who, or the personal representative of any person who,
  has obtained a judgment against the insured or  the  insured's  personal
  representative,  for  damages  for  injury  sustained  or loss or damage
  occasioned during the life of the policy or contract;
    (2) any person who, or the personal representative of any person  who,
  has  obtained  a  judgment against the insured or the insured's personal
  representative to enforce a right of contribution or indemnity,  or  any
  person subrogated to the judgment creditor's rights under such judgment;
  and
    (3)  any assignee of a judgment obtained as specified in paragraph one
  or paragraph two of this subsection, subject further to  the  limitation
  contained in section 13-103 of the general obligations law.
    (c)  (1)  If  an  action  is  maintained  against an insurer under the
  provisions of paragraph two of subsection (a) of this  section  and  the
  insurer  alleges  in  defense  that  the  insured  failed  or refused to
  cooperate with the insurer in violation of any provision in  the  policy
  or  contract  requiring  such cooperation, then the burden shall be upon
  the insurer to prove such alleged failure or refusal to cooperate.
    (2)(A) In  any  action  in  which  an  insurer  alleges  that  it  was
  prejudiced as a result of a failure to provide timely notice, the burden
  of  proof  shall  be  on:  (i)  the  insurer  to  prove that it has been
  prejudiced, if the notice was provided within  two  years  of  the  time
  required  under the policy; or (ii) the insured, injured person or other
  claimant to prove that the insurer  has  not  been  prejudiced,  if  the
  notice  was  provided  more than two years after the time required under
  the policy.
    (B)  Notwithstanding  subparagraph   (A)   of   this   paragraph,   an
  irrebuttable  presumption  of prejudice shall apply if, prior to notice,
  the insured's liability has been determined  by  a  court  of  competent
  jurisdiction  or  by binding arbitration; or if the insured has resolved
  the claim or suit by settlement or other compromise.
    (C) The insurer's rights shall not be  deemed  prejudiced  unless  the
  failure  to  timely provide notice materially impairs the ability of the
  insurer to investigate or defend the claim.
    (d)(1)(A) This paragraph applies with respect to  a  liability  policy
  that  provides coverage with respect to a claim arising out of the death
  or bodily injury of any person, where the  policy  is:  (i)  subject  to
  section  three  thousand four hundred twenty-five of this article, other
  than an excess liability or umbrella policy; or (ii) used to  satisfy  a
  financial responsibility requirement imposed by law or regulation.
    (B)  Upon  an  insurer's  receipt  of  a written request by an injured
  person who has filed a claim or by another claimant, an  insurer  shall,
  within  sixty days of receipt of the written request: (i) confirm to the
  injured person or other claimant in writing whether the  insured  had  a
  liability  insurance policy of the type specified in subparagraph (A) of
  this paragraph in effect with the insurer on the  date  of  the  alleged
  occurrence;  and  (ii)  specify  the  liability  insurance limits of the
  coverage provided under the policy.
    (C)  If  the  injured  person  or  other  claimant  fails  to  provide
  sufficient identifying information to allow the insurer, in the exercise
  of  reasonable  diligence, to identify a liability insurance policy that
  may be relevant to the claim, the insurer shall within  forty-five  days
  of receipt of the written request, so advise the injured person or other
  claimant  in  writing  and  identify  for  the  injured  person or other
  claimant the additional information needed. Within  forty-five  days  of

  receipt  of  the  additional  information, the insurer shall provide the
  information required under subparagraph (B) of this paragraph.
    (2)  If under a liability policy issued or delivered in this state, an
  insurer shall disclaim liability or deny coverage for  death  or  bodily
  injury  arising  out  of  a  motor vehicle accident or any other type of
  accident occurring within this state, it shall give  written  notice  as
  soon as is reasonably possible of such disclaimer of liability or denial
  of coverage to the insured and the injured person or any other claimant.
    (e) No policy or contract of personal injury liability insurance or of
  property damage liability insurance, covering liability arising from the
  ownership,  maintenance  or  operation  of  any  motor vehicle or of any
  vehicle as defined in section three hundred eighty-eight of the  vehicle
  and  traffic  law,  or  an aircraft, or any vessel as defined in section
  forty-eight of the navigation law, shall be issued or delivered in  this
  state  to  the  owner  thereof,  or  shall be issued or delivered by any
  authorized insurer upon any such vehicle  or  aircraft  or  vessel  then
  principally  garaged  or  principally  used  in  this  state,  unless it
  contains a provision insuring the named insured  against  liability  for
  death  or  injury  sustained,  or  loss  or damage occasioned within the
  coverage of the policy or contract, as a result  of  negligence  in  the
  operation  or  use  of such vehicle, aircraft or vessel, as the case may
  be, by any person operating or  using  the  same  with  the  permission,
  express or implied, of the named insured.
    (f)  (1)  No  policy  insuring  against  loss resulting from liability
  imposed by law for bodily injury or death suffered by any natural person
  arising out of the ownership, maintenance and use of a motor vehicle  by
  the  insured shall be issued or delivered by any authorized insurer upon
  any motor vehicle then principally garaged or principally used  in  this
  state  unless it contains a provision whereby the insurer agrees that it
  will pay to the insured, as defined in such provision,  subject  to  the
  terms  and conditions set forth therein to be prescribed by the board of
  directors of the Motor Vehicle Accident Indemnification Corporation  and
  approved by the superintendent, all sums, not exceeding a maximum amount
  or  limit  of  twenty-five  thousand  dollars  exclusive of interest and
  costs, on account of injury to and all sums,  not  exceeding  a  maximum
  amount  or  limit  of  fifty  thousand dollars exclusive of interest and
  costs, on account of death of one person, in any one accident,  and  the
  maximum  amount  or  limit,  subject to such limit for any one person so
  injured of fifty thousand dollars or so killed of one  hundred  thousand
  dollars,  exclusive  of  interest and costs, on account of injury to, or
  death of, more than one person in any one accident, which the insured or
  his legal representative shall be entitled to recover as damages from an
  owner or operator of an  uninsured  motor  vehicle,  unidentified  motor
  vehicle  which  leaves  the  scene  of  an  accident,  a  motor  vehicle
  registered in this state as to which at the time of the  accident  there
  was  not  in effect a policy of liability insurance, a stolen vehicle, a
  motor vehicle operated without permission of the owner, an insured motor
  vehicle where the insurer disclaims liability or denies coverage  or  an
  unregistered  vehicle  because  of  bodily  injury, sickness or disease,
  including death resulting therefrom, sustained by the insured, caused by
  accident occurring in this state  and  arising  out  of  the  ownership,
  maintenance  or  use  of such motor vehicle. No payment for non-economic
  loss shall be made under such  policy  provision  to  a  covered  person
  unless  such  person  has  incurred  a serious injury, as such terms are
  defined in section five thousand one hundred two of this  chapter.  Such
  policy  shall  not duplicate any element of basic economic loss provided
  for under article fifty-one of this chapter. No payments of first  party
  benefits  for  basic  economic  loss made pursuant to such article shall

  diminish the obligations of the insurer under this policy provision  for
  the  payment  of  non-economic loss and economic loss in excess of basic
  economic loss. Notwithstanding any inconsistent  provisions  of  section
  three thousand four hundred twenty-five of this article, any such policy
  which does not contain the aforesaid provisions shall be construed as if
  such provisions were embodied therein.
    (2)  (A)  Any  such  policy  shall, at the option of the insured, also
  provide supplementary  uninsured/underinsured  motorists  insurance  for
  bodily  injury, in an amount up to the bodily injury liability insurance
  limits of coverage provided under such policy, subject to a  maximum  of
  two  hundred fifty thousand dollars because of bodily injury to or death
  of one person in any one accident and, subject to  such  limit  for  one
  person,  up to five hundred thousand dollars because of bodily injury to
  or death of two or more persons in  any  one  accident,  or  a  combined
  single  limit  policy of five hundred thousand dollars because of bodily
  injury to or death of one or more persons in any one accident.  Provided
  however,  an  insurer  issuing  such  policy, in lieu of offering to the
  insured  the  coverages  stated   above,   may   provide   supplementary
  uninsured/underinsured  motorists  insurance  for  bodily  injury, in an
  amount up to the bodily injury liability insurance  limits  of  coverage
  provided under such policy, subject to a maximum of one hundred thousand
  dollars  because  of  bodily injury to or death of one person in any one
  accident and, subject to such limit for one person, up to three  hundred
  thousand  dollars  because  of  bodily injury to or death of two or more
  persons in any one accident, or a combined single limit policy of  three
  hundred  thousand dollars because of bodily injury to or death of one or
  more persons in any one accident, if such insurer also makes available a
  personal umbrella policy with liability coverage limits up to  at  least
  five   hundred   thousand  dollars  which  also  provides  coverage  for
  supplementary  uninsured/underinsured  motorists  claims.  Supplementary
  uninsured/underinsured  motorists  insurance  shall provide coverage, in
  any state or Canadian province, if the limits  of  liability  under  all
  bodily  injury  liability  bonds and insurance policies of another motor
  vehicle liable for damages are in a lesser amount than the bodily injury
  liability insurance limits of coverage provided  by  such  policy.  Upon
  written    request    by    any    insured   covered   by   supplemental
  uninsured/underinsured  motorists  insurance  or  his  duly   authorized
  representative  and  upon  disclosure  by  the  insured of the insured's
  bodily  injury   and   supplemental   uninsured/underinsured   motorists
  insurance coverage limits, the insurer of any other owner or operator of
  another motor vehicle against which a claim has been made for damages to
  the  insured  shall disclose, within forty-five days of the request, the
  bodily injury liability insurance limits of its coverage provided  under
  the policy or all bodily injury liability bonds. The time of the insured
  to  make  any supplementary uninsured/underinsured motorist claim, shall
  be tolled during the period the insurer of any other owner  or  operator
  of  another motor vehicle that may be liable for damages to the insured,
  fails to so disclose its coverage.  As  a  condition  precedent  to  the
  obligation   of   the   insurer   to   pay   under   the   supplementary
  uninsured/underinsured  motorists  insurance  coverage,  the  limits  of
  liability  of  all  bodily  injury liability bonds or insurance policies
  applicable at the time of the accident shall be exhausted by payment  of
  judgments or settlements.
    (B)  In  addition to the notice provided, upon issuance of a policy of
  motor vehicle liability insurance pursuant to regulations promulgated by
  the superintendent, insurers shall notify insureds, in writing,  of  the
  availability of supplementary uninsured/underinsured motorists coverage.
  Such   notification   shall  contain  an  explanation  of  supplementary

  uninsured/underinsured motorists coverage and the amounts  in  which  it
  can  be purchased. Subsequently, a notification of availability shall be
  provided at least  once  a  year  and  may  be  simplified  pursuant  to
  regulations  promulgated  by  the  superintendent,  but  must  include a
  concise statement that  supplementary  uninsured/underinsured  motorists
  coverage is available, an explanation of such coverage, and the coverage
  limits that can be purchased from the insurer.
    (3)  The protection provided by this subsection shall not apply to any
  cause of action by an insured person arising  out  of  a  motor  vehicle
  accident  occurring  in  this  state  against a person whose identity is
  unascertainable, unless the bodily injury to the  insured  person  arose
  out of physical contact of the motor vehicle causing the injury with the
  insured  person  or  with  a  motor vehicle which the insured person was
  occupying (meaning in or upon or entering into or alighting from) at the
  time of the accident.
    (4) An insurer shall give notice to the commissioner of motor vehicles
  of the entry of any judgment upon which a claim  is  made  against  such
  insurer  under  this  subsection and of the payment or settlement of any
  claim by the insurer.
    (g) No policy or contract  shall  be  deemed  to  insure  against  any
  liability  of  an  insured because of death of or injuries to his or her
  spouse or because of injury to, or destruction of property of his or her
  spouse  unless  express  provision  relating  specifically  thereto   is
  included  in  the  policy  as provided in paragraphs one and two of this
  subsection. This exclusion shall apply only where the injured spouse, to
  be entitled to recover, must prove the culpable conduct of  the  insured
  spouse.
    (1)  Upon  written  request  of  an  insured,  and  upon  payment of a
  reasonable premium established in accordance with  article  twenty-three
  of  this  chapter,  an  insurer  issuing  or  delivering any policy that
  satisfies the requirements of article six of the vehicle and traffic law
  shall provide coverage against liability of an insured because of  death
  of or injuries to his or her spouse up to the liability insurance limits
  provided under such policy even where the injured spouse, to be entitled
  to  recover, must prove the culpable conduct of the insured spouse. Such
  insurance coverage shall be known  as  "supplemental  spousal  liability
  insurance".
    (2)  Upon  issuance of a motor vehicle liability policy that satisfies
  the requirements of article six of the vehicle and traffic law and  that
  becomes  effective  on  or  after  January  first,  two  thousand three,
  pursuant to regulations promulgated by the superintendent,  the  insurer
  shall   notify   the   insured,  in  writing,  of  the  availability  of
  supplemental spousal liability insurance.  Such  notification  shall  be
  contained  on  the  front  of  the  premium  notice in boldface type and
  include a concise  statement  that  supplementary  spousal  coverage  is
  available,  an  explanation  of such coverage, and the insurer's premium
  for such coverage. Subsequently, a notification of the  availability  of
  supplementary spousal liability coverage shall be provided at least once
  a  year  in  motor vehicle liability policies issued pursuant to article
  six of the vehicle and traffic law, including  those  originally  issued
  prior  to  January first, two thousand three. Such notice must include a
  concise statement that supplementary spousal coverage is  available,  an
  explanation  of  such  coverage,  and  the  insurer's  premium  for such
  coverage.
    (h) In this section, the term "insurance upon  any  property  or  risk
  located  in  this  state"  includes  insurance  against  legal liability
  arising out of the ownership, operation or maintenance  of  any  vehicle
  which  is  principally  garaged  or  principally  used in this state, or

  arising out of the ownership,  operation,  use  or  maintenance  of  any
  property which is principally kept or principally used in this state, or
  arising  out  of  any  other activity which is principally carried on in
  this state.
    (i)  Except  as  provided  in  subsection  (j)  of  this  section, the
  provisions of this section shall not apply to any policy or contract  of
  insurance  in  so  far  as  it  covers  the liability of an employer for
  workers' compensation, if such contract is governed by the provisions of
  section fifty-four of the workers' compensation law, or by  any  similar
  law  of  another  state,  province  or  country,  nor  to  the  kinds of
  insurances set forth in paragraph three of subsection (b) of section two
  thousand one hundred seventeen of this chapter.
    (j) (1) Notwithstanding any other provision of  this  chapter  or  any
  other law to the contrary, every policy providing comprehensive personal
  liability  insurance  on a one, two, three or four family owner-occupied
  dwelling, issued or delivered in this state on and after  the  first  of
  March,   nineteen   eighty-four,  shall  provide  for  coverage  against
  liability for the payment of any obligation, which the policyholder  may
  incur pursuant to the provisions of the workers' compensation law, to an
  employee  arising  out  of  and in the course of employment of less than
  forty hours per week, in and about such residences of  the  policyholder
  in  this  state.  Such  coverage  shall  provide for the benefits in the
  standard workers' compensation policy issued in this state. No  one  who
  purchases  a policy providing comprehensive personal liability insurance
  shall be deemed to have elected to cover under the workers' compensation
  law any employee who is not required, under the provisions of such  law,
  to be covered.
    (2)  The  term  "policyholder"  as  used  in  this subsection shall be
  limited to an individual or individuals as defined by the terms  of  the
  policy, but shall not include corporate or other business entities or an
  individual  who  has  or  individuals  who  have  in  effect  a workers'
  compensation policy which covers employees working in and about  his  or
  their residence.
    (3)  Every  insurer  who  is  licensed  by the superintendent to issue
  homeowners or other policies providing comprehensive personal  liability
  insurance  in this state shall also be deemed to be licensed to transact
  workers' compensation  insurance  for  the  purpose  of  covering  those
  persons specified in this subsection.