senate Bill S3941

Relates to consideration of an employer's loss experience in rate setting

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Bill Status


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor
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actions

  • 27 / Feb / 2013
    • REFERRED TO LABOR
  • 08 / Jan / 2014
    • REFERRED TO LABOR

Summary

Relates to consideration of an employer's loss experience in rate setting and liability for compensation.

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Bill Details

Versions:
S3941
Legislative Cycle:
2013-2014
Current Committee:
Senate Labor
Law Section:
Workers' Compensation Law
Laws Affected:
Amd §§89 & 10, Work Comp L; amd §2304, Ins L

Sponsor Memo

BILL NUMBER:S3941

TITLE OF BILL: An act to amend the workers' compensation law and the
insurance law, in relation to consideration of an employer's loss
experience in rate setting; and to amend the workers' compensation
law, in relation to liability for compensation

PURPOSE OR GENERAL IDEA OF BILL: To protect businesses from drastic
premium increases in their workers' compensation policies due to motor
vehicle accidents and other injuries that were the fault of a third
party.

SUMMARY OF SPECIFIC PROVISIONS:

Section 1: Amends subdivision 1 of section 89 of the Workers'
Compensation Law to take into account "an employer's loss experience
during the most recent rating plan period; provided, however that such
loss experience shall not include payment on any claims where the
injury was determined to be the fault of another party" for the
purpose of classifying a business in order to establish premium rates.

Section 2: Amends subsection (a) of section 2304 of the Insurance Law
to include that "consideration shall be given to each individual
employer's loss experience during the most recent rating plan;
provided, however that such loss experience shall not include
consideration of payments on any claims where the injury was
determined to be the fault of another party" in the making of rates,

Section 3: Amends subdivision 1 of section 10 of the Workers'
Compensation Law to exempt employers from liability for compensation
"where the injury was sustained in a motor vehicle accident which was
determined to be the fault of a party other than the employee or the
employer, to the extent that compensation can be obtained through the
liability coverage of such person."

Section 4: Effective date.

JUSTIFICATION: Senator Bonacic's office received a complaint that
employees at a small business were involved in two motor vehicle
accidents in 2009 which were deemed to be the fault of the other
parties involved. However, New York State law is such that both
employees medical expenses and wages were covered through workers
compensation rather than auto insurance coverage. This led to the
workers compensation premium for the business to go from $14,000 to
$42,000 per year for claims that were not the fault of the employees
nor the employer.

LEGISLATIVE HISTORY:

S.7133 of 2010:Referred to Senate Labor Committee

FISCAL IMPLICATIONS: Potential salutary effect on the New York State
Insurance Fund through potential reduction in claims.

EFFECTIVE DATE: This act shall take effect on the first of January
next succeeding the date on which it shall have become a law.


view bill text
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  3941

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            February 27, 2013
                               ___________

Introduced  by  Sen. BONACIC -- read twice and ordered printed, and when
  printed to be committed to the Committee on Labor

AN ACT to amend the workers' compensation law and the insurance law,  in
  relation  to  consideration  of  an employer's loss experience in rate
  setting; and to amend the workers' compensation law,  in  relation  to
  liability for compensation

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Subdivision 1 of section 89 of  the  workers'  compensation
law,  as  amended by chapter 135 of the laws of 1998, is amended to read
as follows:
  1. Employments and employees in the state fund shall be  divided  into
such  groups and classes as shall be equitable based upon differences of
industry or hazard for the purpose of  establishing  premium  rates  for
workers'  compensation insurance, and for such purpose a system of merit
rating [may] SHALL be employed which shall take account of the  peculiar
hazard  of each individual risk AND AN EMPLOYER'S LOSS EXPERIENCE DURING
THE MOST RECENT RATING PLAN PERIOD; PROVIDED,  HOWEVER  THAT  SUCH  LOSS
EXPERIENCE  SHALL NOT INCLUDE PAYMENT ON ANY CLAIMS WHERE THE INJURY WAS
DETERMINED TO BE THE FAULT OF ANOTHER PARTY.  Such premiums in the state
fund shall be fixed at the lowest possible  rates  consistent  with  the
maintenance of a solvent fund and of reasonable reserves and surplus.
  S 2. Subsection (a) of section 2304 of the insurance law is amended to
read as follows:
  (a)  In  the making of rates, consideration shall be given to past and
prospective loss experience, including the conflagration and catastrophe
hazards, if any, both within and without  this  state,  to  all  factors
reasonably  attributable  to the class of risks, to a reasonable profit,
to past and prospective expenses both country-wide and  those  specially
applicable  to  this state, and in the case of participating insurers to
policyholders' dividends, savings or unabsorbed premium deposits allowed

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD08604-01-3

S. 3941                             2

or returned to policyholders, members or subscribers.  IN THE MAKING  OF
RATES  FOR WORKERS' COMPENSATION INSURANCE, IN ADDITION TO THE FOREGOING
CONSIDERATION SHALL BE GIVEN TO EACH INDIVIDUAL EMPLOYER'S LOSS  EXPERI-
ENCE  DURING  THE  MOST  RECENT RATING PLAN; PROVIDED, HOWEVER THAT SUCH
LOSS EXPERIENCE SHALL NOT  INCLUDE  CONSIDERATION  OF  PAYMENTS  ON  ANY
CLAIMS WHERE THE INJURY WAS DETERMINED TO BE THE FAULT OF ANOTHER PARTY.
  S  3. Subdivision 1 of section 10 of the workers' compensation law, as
amended by chapter 924 of the laws  of  1990,  is  amended  to  read  as
follows:
  1.  Every  employer  subject  to this chapter shall in accordance with
this chapter, except as  otherwise  provided  in  section  twenty-five-a
hereof,  secure compensation to his employees and pay or provide compen-
sation for their disability or death from injury arising out of  and  in
the  course  of the employment without regard to fault as a cause of the
injury, except that there shall be no liability for  compensation  under
this  chapter when the injury has been solely occasioned by intoxication
from alcohol or a controlled substance of the injured employee while  on
duty;  or by wilful intention of the injured employee to bring about the
injury or death of himself or another; or where the injury was sustained
in or caused by voluntary participation in an off-duty athletic activity
not constituting part of the employee's work related duties  unless  the
employer  (a) requires the employee to participate in such activity, (b)
compensates the employee for  participating  in  such  activity  or  (c)
otherwise  sponsors the activity; OR WHERE THE INJURY WAS SUSTAINED IN A
MOTOR VEHICLE ACCIDENT WHICH WAS DETERMINED TO BE THE FAULT OF  A  PARTY
OTHER THAN THE EMPLOYEE OR THE EMPLOYER, TO THE EXTENT THAT COMPENSATION
CAN BE OBTAINED THROUGH THE LIABILITY COVERAGE OF SUCH PERSON.
  S  4. This act shall take effect on the first of January next succeed-
ing the date on which it shall have become a law.

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