This post will be the third in our series looking at the rulemaking proposed on December 9, 2015 on “Cemetery Annual Financial Reports; Commercial Crime Coverage; and Permanent Maintenance Fund Contributions.” Today’s post looks at the addition of the commercial crime coverage provisions.

The commercial crime coverage provision in the proposed rulemaking is an entirely new requirement necessitated by the fidelity bonds required by 19 NYCRR § 200.5 no longer being available. Instead, the proposed regulation provides that “every cemetery corporation shall carry commercial crime insurance or similar insurance coverage for the acts or omissions of cemetery directors, officers, and employees as well as volunteers who handle money, accounts or securities for the cemetery,” and further requires that the details of the policy (issuer, number, expiration date, etc.) must be included in the annual financial report discussed in the previous post.

Regarding the amount of coverage required, the proposed regulation sets the amount at $15,000 or 10% of total financial assets (defined in the first post), whichever is greater, with a cap of $500,000. This provision is subject to caveats allowing the Division of Cemeteries to increase the amount of coverage if circumstances warranted it. If the Division of Cemeteries did order an increase, this order is still subject to challenge by a cemetery that was aggrieved by such an order pursuant to 19 NYCRR § 200.2(b). The Division cannot, however, require coverage greater than 10% of total financial assets. There are also provisions allowing hardship waivers to reduce or modify the coverage requirement upon a showing of good cause. The exact criteria for such a waiver are detailed in the regulation.