One of the primary considerations in choosing your insurance broker should be the trust and confidence that he or she will protect you and provide you with coverage and financial security.Your broker must have a reputable history with clients and with the insurance companies he or she represent. You must feel confident that they will deliver all the legally required services including promptly remitting the premium you have paid them to the insurance company to avoid cancellation of your policy. If a broker violates insurance laws, he or she may be subject to disciplinary actions which can be fines, penalties and/or revocation of their license to sell insurance.

Insurance Brokers are licensed by the State of New York and are subject to many laws and regulations. Many of these rules are there to protect the public. I have recently seen many TLC Medallion and Black Car owners concerned that they are receiving Non-Payment Cancellations even though they remitted their premium payment to the broker. In these cases, If the broker represented the insurance company at the time they received your payment, the Insurance Company is required to apply that credit to the policy and reinstate your policy under the following sections of law:

Insured’s Payment of Premium to Insurance Broker - Section 2121 of the Insurance Law provides that an insurer that delivers a contract placed by a broker is deemed to have authorized that broker to receive premium on its behalf. “Pursuant to New York State Insurance Law Section 2121(a) (McKinney 2000), a premium payment made to an insurance broker is deemed to be payment made to the insurer. An insurance broker should accept an insured's premium payment where it is in the insured's best interests to do so.An insurance agent is the representative of the insurer and must, therefore, accept premium payment from an insured.”

N.Y. Ins. Law § 2121(a) (McKinney 2000) states: “Any insurer which delivers in this state to any insurance broker or any insured represented by such broker a contract of insurance pursuant to the application or request of such broker, acting for an insured other than himself, shall be deemed to have authorized such broker to receive on its behalf payment of any premium which is due on such contract at the time of its issuance or delivery or payment of any installment of such premium or any additional premium which becomes due or payable thereafter on such contract, provided such payment is received by such broker within ninety days after the due date of such premium or installment thereof or after the date of delivery of a statement by the insurer of such additional premium.”

This section provides that an insurance broker is authorized to accept payment of premium on behalf of the insurer.Thus, under § 2121, timely payment to an insurance broker is deemed to be payment to the insurer.

The New York State Insurance Department website has information for consumers at: http://www.ins.state.ny.us/nyins.htm

At the very least, your broker should provide you with:

• Confidence your payments are remitted promptly to the Insurance Company,
  

• Efficient claims processing without any additional fees,

• Experience and knowledge in your industry (TLC) for proper guidance,

  
  
  

• Service without additional broker or policy fees - unless agreed to, in writing,

  
  
  

• Knowledgeable advice relating to coverage, policy limits, and available options.

If you have concerns about the financial responsibility of your broker ask your insurance company for a listing of their authorized representatives, or ask others in the business to recommend a trustworthy broker. Make sure your broker represents the company directly and not through another broker. Under most circumstances, you can choose a trustworthy broker with a simple change of broker authorization, and you may not need to change insurance companies, just change the broker.

Of course, most people look for the lowest price insurance and that is important, especially in today’s economy. Equally important is to be covered, and to stay out of trouble with the Department of Motor Vehicles and the Taxi Limousine Commission. If you have an accident, you don’t want to worry if your policy was reinstated on time due to a non-payment. Also, cancellations cause problems with the DMV and TLC. Every time you have a cancellation a notice goes to them starting a registration revocation process automatically that can lead to license suspension if not corrected properly. The right broker helps you stay out of trouble so choose your broker and insurance company carefully.

For more information talk to your insurance professional, or the author of this article.