Annual Certifications of Compliance

The Certification of Compliance is a critical governance pillar of the cybersecurity programs of all Covered Entities. Prior to April 15th of each year, all Covered Entities must file a Certification of Compliance confirming their compliance with the Cybersecurity Regulation for the previous calendar year.

An entity or individual should only submit a Certification if they were in compliance with all portions of the regulations that applied to that Covered Entity during the time period the Certification covers. Even if a Covered Entity qualifies for an exemption pursuant to 500.19(a), (c), or (d), it has to submit a Certification of Compliance to demonstrate that it was in compliance with the sections of the regulation that apply pursuant to the particular exemption. (The exemption set forth in 500.19(b) is the only exemption that does not require a Covered Entity to file a Certification of Compliance.)

Certifications of Compliance for the calendar year 2021 are due by April 15, 2022.  Covered Entities that hold more than one license must file a separate Certification of Compliance for each license it holds.

Instructions on how to file a Certification of Compliance can be found by clicking https://www.dfs.ny.gov/system/files/documents/2019/12/cyber_cert_compliance_filing.pdf

Covered Entities Do Not Need to File New Notices of Exemption
Any DFS regulated entity or licensed person who filed a Notice of Exemption previously does not need to refile a Notice of Exemption. However, if your exempt status has changed, then the entity or individual should amend or terminate their filing through the DFS portal.

How to File
The DFS Cybersecurity Portal has been redesigned to assist you with your filings. To ensure that filings are matched to the appropriate Covered Entity or licensed person, we encourage the use of an identifying number when filing. Identifying numbers are New York State License number, NAIC/NY Entity number, NMLS number or Institution number. Please make sure that you have your license number available when you make your filing. A look-up feature is included in the Portal for anyone who does not know which number to use.

To get started please visit the DFS Cybersecurity Portal: https://myportal.dfs.ny.gov/web/cybersecurity/ 

Guidance to Insurance Producers regarding Electronic Delivery of Notices

The Department of Financial Services (“Department”) is aware of insurance producers (“Producers”) facing challenges complying with the notice obligations in new 11 NYCRR § 229.5(b) and 3 NYCRR § 405.6(b)(4) described below (“Notice Obligations”).

First, regarding obtaining consumers’ consent to electronic communications, please see the Department’s Current Guidance Regarding Electronic Signatures, Transactions, and Filings with DFS.

Second, the Department is accommodating Producers by reducing their burden to fulfill the Notice Obligations during the current state of emergency. Specifically, for the duration of the current state of emergency, Producers may comply with the Notice Obligations by emailing the notices to the consumers for which the Producers have email addresses, regardless of whether the consumers have consented to receiving this notice via email.

Producers with websites should post the information on their websites as soon as possible. The Department also encourages supplemental dissemination of the content of the Notice Obligations by other means, including social media.

Finally, Producers should maintain records of their communications with consumers, electronic or otherwise, used to satisfy the Notice Obligations for a period of time sufficient to satisfy applicable statutes of limitation and, where an action or claim is pending, for such period of time until the matter is resolved. See Office of General Counsel Opinion 05-03-32 (March 24, 2005). In addition, if a Producer obligated itself by contract with its principal, the insurer or insured, to retain records for a period of time, then such obligation, if legally enforceable, must be satisfied, subject to an alternative acceptable to the principal. These communications used to satisfy the Notice Obligations may be subject to Department review, including but not limited to, on examination.

Below is a summary of the insurance producer requirement in the relevant emergency regulations.

New 11 NYCRR § 229.5(b) and 3 NYCRR § 405.6(b)(4) require a licensed insurance producer who services an in-force life insurance policy, annuity contract, or fraternal benefit society certificate or who procured a property/casualty insurance policy for the policyholder or contract holder to mail or deliver notice to the policyholder or contract holder of the provisions of 11 NYCRR 229 and 3 NYCRR § 405.6 within ten business days following the promulgation of 11 NYCRR 229 and 3 NYCRR § 405.6.

The recent decision by Judge Rakower and the ensuing developments have been overwhelming to understand at times.  Much of this complexity was explained at the two Town Hall meetings but of course every member was not able to attend those sessions.

Therefore, we are providing you with a brief summary of the status of the litigation below.  I will do my best to keep this simple and concise.

•     We brought our suit in the NY State Supreme Court in New York County.
•     The case was assigned to Judge Rakower and pleadings were filed by our attorneys.
•     The Attorney General’s (AG) office representing the DFS replied to our pleadings and we responded.
•     A hearing was held before Judge Rakower on  June 14, 2018.
•     Judge Rakower rendered a decision on July 5th.
•     The decision effectively nullified Regulation 208 in its entirety.
•     The AG filed a notice of appeal on July 6th.
•     The AG immediately notified our attorneys of their intention to seek an emergency stay of the judge’s decision. An emergency stay, If granted , would postpone the judge’s ruling of annulling the regulation and “reimpose” the Regulation 208 until the case was heard on appeal in the Appellate Division).
•     The AG later informed our counsel that they would NOT be seeking an emergency stay.
•     Both the AG and NYSLTA must file additional pleadings with the Appellate Division prior to the next court appearance.

The earliest this matter could come before the Appellate judges is October. Given the congestion of the court’s schedule, it could slip to late October or later.  Until then, the regulation 208 is annulled.   All other regulations pertaining to the title industry remain in effect.

 We will continue to keep you advised.

Please see the attached document.

The current issue of City and State Magazine is dedicated to the topic of insurance.  You can read it online here - https://issuu.com/cityandstate/docs/csny_04092018_version .

This edition contains interviews with the Chairmen of the Insurance Committees in the State Senate and the Assembly, Senator Seward and Assembly Member Cahill.  Both of these gentlemen answer a question on title insurance on page 21 and I encourage you to read their comments. (I also suggest you take a look at the NYSLTA ad on page 23.)

For several months, NYSLTA Members and other concerned citizens have activity communicated with our legislators to repair DFS regulations that threaten our livelihood, disrupt the real estate finance marketplace and create new costs and complications for consumers, lenders and attorneys.

At times, it may appear our efforts are fruitless. I admit the investment is great and to date the returns have been slim. For perspective, I ask you to look closely at Chairman Cahill's reply to the title insurance question.

" Last year, the Assembly Insurance Committee held a hearing on the impact the new regulations are having or would have. The testimony and evidence from stakeholders and consumer advocates was compelling.

Since then, even more colleagues have approached me as chair of the Assembly’s Insurance Committee to discuss title insurance regulatory change.

In fact, more than any other single insurance topic, Assembly members from across the state have brought the concerns of their constituents regarding title insurance regulation to my attention.

While some would attribute the currency of the issue to heavy industry lobbying, it is clear, instead, that the disruption caused by regulatory overreach has impacted stakeholders in every phase of real estate transactions..."

This growing awareness and understanding of the problematic consequences of DFS regulation 208 is the result of YOUR phone calls, YOUR emails, YOUR person-to-person conversations with legislators and key staffers.

The process is slow but this is how we build a presence for the title insurance industry in the halls of government. One by one, one meeting at a time, with follow-up and repetition, with single-minded and consistent messaging - this is how we counter the misinformation and misunderstanding about the work we do and the financial product we provide.

Our work informing and educating the legislators and their staff does not end with Regulation 208. Next year and every year after that, we will function under the purview of the DFS.  Strong relationships in the legislature are our best means of counterbalancing onerous regulation.

If you have sent an email or made a phone call to your Senator or Assembly Member - thank you and now take the next step and meet with them in person.  If you have lobbied in the district office or in Albany - you are a champion, and we need you to bring along others as we continue the effort.