New York State seal

December 31, 1984

SUBJECT: INSURANCE

WITHDRAWN

(EFF. 12-4-03)

DATED: DECEMBER 31, 1984

SUPPLEMENT NO. 4 TO CIRCULAR LETTER NO. 16 (1981)

TO: ALL AUTOMOBILE SELF-INSURERS AND INSURERS WRITING AUTOMOBILE INSURANCE IN THIS STATE.

RE: REDUCTION IN NO-FAULT LOSS OF EARNINGS BENEFITS FOR QUALIFIED WAGE CONTINUATION PLANS.

Section 5102(a)(2) [formerly Section 671(1)] of the Insurance Law contains a provision that requires insurers to reduce gross loss of earnings from work by benefits paid under what have become known as "qualified wage continuation plans" when calculating no-fault first party benefits payable for loss of earnings.

In order for a particular wage continuation plan to qualify for purposes of the aforementioned provision, it must meet all of the following three conditions:

(1) the applicant must be entitled to receive the same level of wage continuation benefits for a subsequent unrelated accident or illness when he or she returns to work after recovering from the injuries sustained in the motor vehicle accident;

(2) benefits for a subsequent unrelated accident must be equal in both time and amount to the wage continuation benefits to which the applicant was entitled as a result of the injuries suffered in the motor vehicle accident; and

(3) wage continuation benefits for a subsequent disability must be immediately available, without any requirement that the applicant work a stated period of time before full benefits are restored.

If these three conditions are met, the plan will generally qualify.

In addition, for all "qualified plans" that provide benefits less than one hundred percent (100%) of the employee's salary, the insurer should reduce the amount paid under the "plan" by the amount required to be paid in satisfaction of the New York State Disability Law. Only the excess over the New York State Disability Benefits is a "qualified wage continuation plan" benefit.

In order to provide for consistent application of this provision, the Insurance Department has been reviewing plans submitted by insurers and employers and classifying them as either "qualified" or "non-qualified". The revised lists appended hereto contain additional plans reviewed since the November 2, 1983 issuance of Supplement No. 3 to this Circular Letter.

Insurers are reminded that insureds covered by a "qualified wage continuation plan" are entitled to a premium reduction to reflect the insurer's reduced exposure to loss, pursuant to Section 2330 [formerly Section 677(6)] of the Insurance Law. Insurers must grant the premium reduction upon receipt of information that the insured is entitled to benefits under a qualified wage continuation plan.

Insurers are again requested to submit for approval, to the address shown below, details of any other plans that they believe may qualify. All plans submitted will be reviewed and, periodically, the Department will issue revised lists of qualified and non-qualified wage continuation plans. Please note that long-term disability plans, which generally become effective six months after the date disability begins, are not qualified wage continuation plans.

Martin Reis, Examiner

Property & Casualty Insurance Bureau

New York State Insurance Department

160 West Broadway

New York, New York 10013

Very truly yours,

[SIGNATURE]

JAMES P. CORCORAN

Superintendent of Insurance

ATTACHMENT

QUALIFIED PLANS

   

EMPLOYER

COVERED EMPLOYEES AND BENEFITS

ARCO Metals Co.

Hourly Employees - Entitled to up

 

to $ 145 per week for up to 26

 

weeks per disability. Salaried

 

Employees - Entitled to full

 

salary for up to 6 months per

 

disability, after one year of

 

service.

   
Bedford Central School

Teachers on Tenure. Maximum of

 District

2 years at full pay.

   

 ** Boys' Club of New York

All employees with a least six

 

months of service. From 2 to 26

 

weeks at full pay dependent upon

 

length of service.

   

 *** Chevrolet, Inc.

All employees represented by the

 

U.A.W. with one year or more of

 

service are entitled to benefits

 

for 52 weeks equal to

 

approximately 60% of the

 

employee's weekly salary, as set

 

forth in schedule of benefits

 

contained in U.A.W. contract.

   

Corning Glass Works

Hourly Roll Employees - Entitled

 

to an "Enriched Disability

 

Plan", which provides up to $ 160

 

per week for a maximum of 26

 

weeks per disability.

 

Other Than Hourly Roll Employees -

 

Entitled to from 1 to 26 weeks

 

of full pay per disability,

 

depending upon length of

 

service. The "Enriched

 

Disability Plan" (see hourly

 

roll employees above) is used

 

(up to $ 160 per week maximum)

 

only to supplement the wage

 

continuation benefit when full

 

salary benefits have been

 

exhausted. Insurers must

 

ascertain the number of weeks to

 

which the eligible injured

 

person is entitled.

   

Depository Trust Co.

Professional, administrative,

 

supervisory employees, guards

 

and confidential secretaries are

 

entitled to full salary for up

 

to 180 days.

   

 * Federal District Court

Justices only.

   

 ** F.M.C. Corporation

Hourly Employees only. Full

 

time hourly employees with at

 

least 12 months service: 13 to

 

58 weeks, dependent upon length

 

of service; payable at 85% to

 

100% of salary, dependent upon

 

length of disability.

   

Ford Motor Co.

See Chevrolet (above)

   

G.A.T.X. Corp.

All employees. From one to six

(American Steamship Corp.)

months at full pay; or

 

combination of full pay and 2/3

 

pay for a maximum of six months,

 

depending upon length of service.

   

General Electric Co.

All employees. Level I benefits-

 

20 days each 12 months, at full

 

pay. No-Fault insurers are

 

required to pay full no-fault

 

benefits (no reduction) when

 

this benefit period is utilized,

 

since as the time is used, it is

 

lost. However, insurers are

 

entitled to the applicable

 

weekly disability offset.

 

Level II Benefits - Payable only

 

after Level I Benefits have been

 

exhausted. Benefits are equal

 

to 60% of employee's weekly

 

salary up to a maximum weekly

 

benefit of $ 200 for up to 26

 

weeks.

   

 * Greenwich Fixture Co.

Officers of the company not

 

covered by the union plan.

   

 ** Gulf & Western Industries.

From 1 to 26 weeks, dependent

 

upon length of service; payable

 

at 60% to 100% of salary,

 

dependent upon length of

 

disability.

   

 ** Houdaille Industries,

Full time permanent salaried

 Strippit Division

employees: 90 days at 100% of

 

basic salary, followed by 90

 

days at 50% of basic salary.

   

Ingersoll - Rand Co.

Union employees - $ 145 per week

 

for a maximum of 52 weeks.

 

Salaried Employees - Full

 

salary for 3 to 26 weeks; or

 

combination of full pay and 60%

 

of salary for a maximum of 26

 

weeks, depending upon length of

 

service.

   

 ** John Hancock Mutual

District Agents Only. From 8 to

 Life Ins. Co.

104 weeks, dependent upon length

 

of service; 100% of salary for

 

first week, 2/3 of salary for

 

remaining period of eligibility.

   

 * Village of Mamaroneck,

Police Officers.

 N.Y.

 
   

 * Manhasset Union Free

All professional personnel

 School District

including teaching and

 

administrative staff.

   

Motorola, Inc.

All employees, after 1 year of

 

service are entitled to: 1. 90

 

days at full pay; and 2. next 90

 

days at half pay.

   

 * New York City

Employees in the uniformed

 

services of Police, Fire,

 

Corrections and Sanitation

 

Departments only.

   

New York State Electric

Hourly Employees - (with more

 and Gas Corp.

than 6 months service) -

 

entitled to 85% of basic

 

earnings (40 hour week) for up

 

to 26 weeks per disability.

 

Salaried Employees - Entitled

 

to full salary for a specified

 

period of time, based on length

 

of service. Insurer must

 

ascertain benefit period

 

eligible injured person is

 

entitled to.

   

Niagara Mohawk Power

All employees. Benefits are

 

payable for up to 26 weeks at

 

100% of salary.

   

Occidental Chemical Corp.

All employees (after successful

 

completion of probationary

 

period) - 55% of base salary for

 

a maximum of 26 weeks per

 

disability.

   

J.C. Penney

All employees working more than

 

20 hours per week (after 13

 

weeks of service) - Combination

 

of full pay and 1/2 pay for a

 

maximum of 26 weeks, depending

 

upon length of service, after a

 

waiting period of 0-5 days,

 

depending upon length of service.

   

Prudential Property and

All Employees: (Level I) 10, 15,

 Casualty Ins. Co.

or 20 days at full pay per year

 

depending upon length of

 

service. (Level II) Payable

 

only after initial period

 

benefits have been exhausted.

 

Benefits are equal to: (1) 75%

 

of base salary for employees

 

with less than 5 years of

 

service, payable for up to 26

 

weeks per disability; or (2) 90%

 

of base salary for employees

 

with 5 or more years of service,

 

payable for up to 52 weeks per

 

disability.

   

 ** Remington Arms Co.

All employees with at least one

 

year of continuous service.

 

Full wages for a maximum of 6

 

months.

   

Reynolds Metals Co.

Employees with less than 2 years

 

of service - up to 26 weeks per

 

disability. Employees with more

 

than 2 years of service - up to

 

104 weeks per disability.

 

Benefits range from $ 235 per

 

week to $ 303 per week, depending

 

upon an employee's "Insurance

 

Class".

   

 ** Savin Corporation

All permanent, full time,

 

non-union employees with at

 

least 90 days continuous

 

service. From 2 to 26 weeks at

 

100% of salary, or combination

 

of 100% and 66 2/3%, dependent

 

upon length of service.

   

Stauffer Chemical Co.

All Employees. Benefits are

 

payable for up to 6 months (3

 

months for employees with less

 

than one year's service) at 100%

 

of salary.

   

 ** Sterling Drug, Inc.

All salaried employees who

 

regularly work at least 20 hours

 

per week. From one-half to six

 

months at 100% of salary, or

 

combination of 100% and 60%

 

(dependent upon length of

 

service), commencing on the

 

eighth calendar day of absence.

 * U.S. Armed Forces

All members of the Armed Forces.

   

Westinghouse Electric Corp.

All employees scheduled to work

 

24 or more hours per week are

 

entitled to approximately 60% of

 

weekly salary up to a maximum of

 

$ 225 per week for up to 26 weeks

 

per disability.

   

* City of Yonkers, N.Y.

Police Officers.

 
   

* Unlimited sick leave plans providing full salary for

the duration of disability.

   

** Plans reviewed since Supplement No. 3 was issued

(November 2, 1983).

   

*** Applies to employees of all divisions of General

Motors who are represented by the U.A.W.

NON-QUALIFIED PLANS

Alliance Tool Corp.

Fisher - Price Toys

 ** Almor Corp.

 ** Genesee Nursing Home

 ** American Airlines

W.W. Granger, Inc.

Amos Post, Inc.

 ** Graphic Controls Corp.

 ** A.S.C.A.P.

 ** Halcon SD Group, Inc.

Associated Metals and

Harris Corp.

Minerals Corp.

Hart Schaffner and Marx

 ** Town of Babylon

 (Wallachs)

 ** Bankers Life & Casualty

I.B.M.

 Co. of N.Y.

International Telephone and

 ** Bethlehem Steel Corp.

 Telegraph Corp. (ITT)

Bristol Labs a.k.a. Bristol

Ivy Hill Corp.

 Myers

 ** Janney Montgomery

 ** The Brookdale Hospital

 Scott Inc.

 Medical Center

 ** Leviton Manufacturing Co.

 ** Buffalo Color Corp.

Lightron of Cornwall, Inc.

Buffalo Envelope

Longines - Wittnauer Watch Co.

 ** Carpenter Technology Corp.

MacMillan, Inc.

C.D.I. Corp.

Management Assistance, Inc.

Celanese Corp.

Montgomery Ward

 ** CIBA-GEIGY CORP.

M.O.N.Y.

Community Savings Bank

 ** Morgan Guaranty Trust

Computer Task Group

 Co. of N.Y.

Consolidated Edison Co.

 ** Nassau Recycle Corp.

 ** Control Data Corp.

National Bulk Carriers

 ** Dairylea Cooperative Inc.

Nationwide Insurance Co.

Dellwood Foods, Inc.

Nestle

Dobbs Ferry U.F.S.D.

 ** New York Air Brake Co.

Eastman Kodak

New York Daily News

Elmira College

New York State Employees

 ** The Equitable Life

New York Telephone Company

 Assurance Society

New York Times

 ** Price Chopper Supermarkets

 

Rochester Telephone

 

 ** St. Elizabeth Hospital (Utica)

 

So. Huntington Schools

 

 U.F.S.D. # 13

 

Sperry Rand

 

State University of New York

 

Syosset General School District

 

 ** United States Postal Service

 

Western Electric

 
   

NOTE: If an employee covered by a non-qualified

plan is eligible for New York State

Disability Benefits, the insurer is entitled

to an offset pursuant to Section

5102(b)(2)[formerly Section 671(2)(b)] of

the Insurance Law.

   

** Plans reviewed since Supplement No. 3 was issued

(November 2, 1983)