On December 19, 2025, New York Governor Kathy Hochul signed the FAIR Business Practices Act, which amends New York’s Consumer Protection Law (New York General Business Law § 349) to provide additional protections to policyholders. Section 349 bans deceptive and unfair acts by businesses. The amendment makes it easier for policyholders to enforce the law and bans additional conduct.

New York Courts have long held that the Consumer Protection Law protects insurance policyholders and penalizes bad faith conduct by insurers. The FAIR Act means that policyholders now have a new tool to pursue insurers who act in bad faith.

Most importantly for policyholders, the FAIR Act removes the “consumer-oriented conduct” requirement. Previously, policyholders had to demonstrate that an insurer’s offensive conduct affected consumers at large. “Private contractual disputes” were not enough to support a § 349 claim. This often left policyholders unable to bring an action for statutory bad faith because the misconduct was often directed only towards the policyholder and not towards other consumers. To prevail, policyholders had to show a pattern of deceptive conduct aimed at similarly situated policyholders. This necessitated broad and costly discovery into other claims against other policyholders, something that insurers routinely resist disclosing unless compelled to do so.

The amendment states “An act or practice made unlawful by this section is actionable . . . regardless of whether or not that act or practice is consumer-oriented.” This greatly benefits policyholders. Now, a single instance of deceptive or unfair conduct aimed at the plaintiff is sufficient to support a violation. There no longer is a need to prove repeat conduct aimed at many policyholders.

The other significant change is that the law now prohibits a broader spectrum of conduct. Previously, § 349 prohibited only “deceptive” acts. The law now bans “unfair, deceptive, or abusive acts or practices.” This recognizes that an insurer may unfairly harm policyholders even without deception. This often occurs when there is a disparity in market power, as is often the case with insurance.

The FAIR Business Practices Act is a powerful tool for policyholders in New York in maintaining an even playing field with their insurers. New York has long had a reputation as pro-insurer jurisdiction. Those days may now be numbered.