British & Foreign Marine Insurance v. Stewart 33 A.D.2d 1008

Determination by the Superintendent of Insurance dated April 1, 1969, unanimously annulled on the law without costs and without disbursements. After an evidentiary statutory hearing the Superintendent held that petitioners in sending out 206 notices of cancellation of insurance policies on commercial properties located in the Harlem and Bedford-Stuyvesant areas of New York City violated subdivision 10 of section 40 of the Insurance Law which provides that no insurance company “ shall make any distinction or discrimination between persons because of race, color, creed or national origin, as to the premiums or rates charged or in any other manner whatever.” Petitioners were fined $20,600. The Superintendent also held that the cancellation notices constituted unfair methods of competition and unfair and deceitful acts or practices and directed petitioners to cease and desist from such practices. The underlying facts are undisputed. The record establishes and the Superintendent found that in canceling the insurance petitioners were motivated by underwriting and business reasons and not by racial hostility. The Superintendent concedes that the Insurance Law does not prohibit policy cancellations generally, nor does it prohibit underwriting distinctions on the basis of location but claims that “ The law does prohibit distinctions based on race, and that includes racial distinctions in selecting areas in which persons will not be insured as well as racial distinctions in directly selecting persons who will not be insured”. The determination of the Superintendent is not based upon any action directed against any individual or group of individuals. It is clearly addressed to petitioners’ actions with respect to certain areas. A careful examination of the record fails to disclose any substantial evidence to support the Superintendent’s determination. Concur — Eager, J. P., Capozzoli, Nunez, McNally and Tilzer, JJ.