New York Programs
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A mandatory program for workers compensation applied only to insureds who are large enough for the individual insured’s own past experience to be an indicator of how the benefit cost for this insured will differ from the average in the future.
A process by which historical insurance statistics are compiled, analyzed and projected into the future by trained actuarial professionals in order to produce adequate and equitable manual rates or loss costs. The Actuarial Department of the Rating Board is responsible for calculating the appropriate loss cost for each of approximately 600 classifications of businesses throughout the state.
An optional program which is mutually agreed upon by the employer and the insurer. It is a program where, in essence, the employer agrees, prior to the inception of the policy, to pay for his own workers compensation costs, plus a basic charge which largely covers the costs of the insurer-provided services.
The New York Construction Classification Premium Adjustment Program (NYCCPAP) was adopted on April 1, 1993 to address premium differences between high wage and low wage paying employers having similar construction operations. Premium credits based upon the hourly wage rate paid by the employer and the distribution of classifications shown on the employer’s policy are developed by the Rating Board and applied to the insured’s premium.
New York State Legislation requires that all insureds whose annual payroll exceeds $800,000 and whose most recent experience rating exceeds 1.20 implement an approved safety and loss prevention program. The Rating Board is responsible for notifying all employers who meet the eligibility criteria that they are required to undergo a safety and loss prevention consultation.
When an employer’s premium is less than the amount necessary to qualify for Interstate or Intrastate experience rating, but greater than the minimum premium, he/she is eligible for the Merit Rating Program. A credit or debit is then calculated which is based upon the number of indemnity and medical claims incurred during the most recent three year period for which statistics are available. Cases to be counted as claims are defined as those which have been paid (totally or partially) or for which a reserve has been established. This three year period is that which would otherwise be used for experience rating purposes.
The Rating Board can provide information to self insurers concerning experience ratings, including the calculation of a rating based on a self-insurer’s available loss and payroll data. The Rating Board can also provide, by type of business, information concerning rates and premium charges which a current self-insurer would incur under a standard workers compensation policy.
Governor George Pataki signed into law, effective October 1, 1999, Senate Bill S7744 (also identified as Assembly Bill A11294) which is intended to provide a more equitable distribution of premium between high wage paying and low wage paying employers in the construction industry. Work performed in the construction, remodeling, maintenance or repair of one or two-family residential housing are excluded from the provisions contained in the Law.
A program implemented in order to verify that member carriers accurately and consistently apply classifications, rates, rating plans and other factors to the policies of their insureds. It also ensures that statistical data is accurately reported on policies affected by the program and to establish a standard of performance for carriers to achieve following an audit. The program provides incentives for carriers who exceed the minimum standard to improve their audit proficiency and establishes a procedure for the Rating Board to work with member carriers who exceed the minimum performance standard.
Subject to certain criteria, an insured may elect to reimburse its carrier for a specific dollar portion of each claim. Both small deductible and large deductible programs are available in New York.