January 29th, 2024
The Honorable Letitia James
Attorney General of the State of New York Office of the New York State Attorney General The Capitol
Albany NY 12224-0341
Re: Urgent Call for Investigation into New York State Insurance Industry and CHUBB’s Conspiracy to Defraud Child Victims Act Survivors
Dear Attorney General James,
The Coalition for Just and Compassionate Compensation (CJCC), an advocacy organization composed of survivors of child sexual abuse, their representatives, and advocates across New York, writes to you today with urgency. Despite the Department of Financial Services (DFS) Circular Letter providing guidance on the Child Victims Act’s (CVA) implementation for insurance companies operating in New York State, carriers like CHUBB, continue to use every possible stalling tactic available to deny survivors of childhood sexual abuse their rightful compensation and evade the intent of the Child Victims Act.
While we appreciate the DFS’s efforts to advance guidance without enforcement action, carriers like CHUBB will continue to boldly engage in the old insurance dance of deny, deny, and use every legal argument, no matter how weak or specious, to avoid paying claims. For example, CHUBB has blatantly abused the concept of “expected and intended” coverage in an effort to deny claims on a whim. This interpretation defies both the spirit of the CVA and the common- sense reading of policy language. It essentially allows CHUBB to retroactively rewrite contracts and escape its contractual obligations.
CHUBB’s refusal to honor its contractual obligations under insurance policies issued to domestic insureds is not solely a risk specific problem. It is reflective of a larger business strategy being deployed throughout the United States to force insureds into bankruptcy and reduce its obligations to pay on claims up to its policy limits. Without the intervention of a state attorney general, CHUBB will continue to utilize this unethical business practice unchecked, to the detriment of policyholders and beneficiaries.
CHUBB’s efforts to deny coverage for CVA claims are not only immoral, but we believe they may violate New York insurance laws and regulations. Therefore, we urgently request your office to launch a comprehensive investigation into the New York State insurance industry, with particular focus on CHUBB’s practices, specifically examining:
- Frivolous Lawsuits: Investigate how CHUBB manipulates the concept of “expected and intended” and other specious legal assertions to deny valid claims, disregarding policy language and established legal principles.
- Impact on survivors: Evaluate the emotional and financial toll inflicted on survivors by CHUBB’s delay tactics and wrongful denials. In particular, how delays will likely impact claimants, most of whom are in the twilight of their years.
- Compliance with DFS Circular Letter: Assess whether CHUBB is adhering to the DFS’s clear instructions regarding CVA implementation. Identify any deviations and hold them accountable for non-compliance.
- Violating New York Laws and Regulations: Investigate whether CHUBB is violating New York Insurance Law § 2601, and New York General Business Law § 349. These laws and regulations require insurers to act in good faith and to cooperate with insureds to ensure that sexual abuse victims may be fairly compensated. More specifically,insurers are prohibited from failing to attempt in good faith to “effectuate prompt, fair, and equitable settlements of insurance claims submitted in which liability has become reasonably clear.”
- Transparency and consistency: Probe CHUBB’s claims handling practices. Are claims denied arbitrarily, or is there a systematic pattern of bias against survivors?
- Industry-wide communication and collusion: This effort to deny claims to survivors extends beyond CHUBB. Is there communication and collusion within the industry to share strategies and methodologies for evading CVA claims?
CHUBB’s actions are not merely bad faith; they are a deliberate and unconscionable campaign to deprive childhood sexual abuse survivors of justice. They exploit the trauma and vulnerability of these individuals to line their own pockets, last quarter alone reporting record profits of over $2 billion. This cannot stand.
We implore you, as the chief law enforcement officer of the state, to act with swiftness and determination. Survivors deserve more than guidance and circular letters. They deserve protection from predatory insurance companies and access to the compensation they are legally entitled to.
We stand ready to assist your office in any way possible in this crucial investigation. Sincerely,
The Coalition for Just and Compassionate Compensation