New York Gov. Kathy Hochul signed into law legislation that seeks to restore the ability of businesses to access low-cost workers’ compensation coverage through the New York State Insurance Fund (NYSIF).
Businesses in the state are required by law to secure workers’ compensation coverage, which most obtain through NYSIF or a private insurer. However, unlike private insurers, NYSIF insures any employer that applies for coverage at the lowest possible cost, regardless of risk. Also, NYSIF may only cancel a policy for non-payment of premium and was precluded from re-issuing a policy to a business that owed it premium.
But with this new law, that changes. Now, the NYSIF can issue a policy to a business with an outstanding balance, allowing the company to pay the owed premium under an installment plan. This legislation will give more than 3,000 New York businesses renewed access to the largest segment of the low-cost insurance market, generating an aggregate of $8 million in potential premium savings, or an average of approximately $2,000 per policyholder.
“At the height of the COVID-19 pandemic, thousands of New York businesses struggling to stay afloat lost access to affordable workers’ compensation coverage when they needed it most,” Hochul said. “But today, thanks to bill sponsors Senator Ramos and Assembly Member Fernandez, we’re announcing action to ensure that businesses can continue to protect their workers with affordable coverage while addressing any back premium. This bill will restore much-needed access, saving businesses across the state millions of dollars in premium and helping their bottom line.”
Under the new law, policyholders can work with NYSIF to establish a payment plan for both the outstanding balance and premium on the new policy.
“Thanks to Governor Hochul’s leadership, employers across New York can now stay insured by NYSIF and protect their employees during difficult times. The new law also affords NYSIF an opportunity to reconnect with our public mission, giving us the flexibility to help employers in distress and ensure a fair marketplace,” said Gaurav Vasisht, executive director and CEO of NYSIF.