New York State Seal
STATE OF NEW YORK
INSURANCE DEPARTMENT
25 BEAVER STREET
NEW YORK, NEW YORK 10004

George E. Pataki
Governor

Gregory V. Serio
Superintendent

The Office of General Counsel issued the following opinion on January 17, 2003, representing the position of the New York State Insurance Department.

Re: No-Fault Additional Personal Injury Protection

QUESTIONS PRESENTED:

1. When an insured purchases optional Additional Personal Injury Protection ("Additional PIP") No-Fault coverage, in addition to the required Personal Injury Protection ("PIP"), No-Fault coverage in New York (i.e. basic economic loss), so that an eligible injured person may receive double the amount of lost wages benefits that would have been available had the person been covered solely under the minimum required basic economic loss coverage, must the No-Fault insurer pay the total amount of loss wage coverage available per month under the purchased Additional PIP coverage, after benefits available under basic economic loss have been exhausted?

2. When a No-Fault insurer receives a claim for health services rendered from a provider prior but has not receive the required written application for No-Fault benefits from the eligible injured person, who must the insurer contact with respect to the submission of the required application, so that the provider may be reimbursed for medically necessary services rendered?

CONCLUSIONS:

1. Yes. In accordance with the New York No-Fault Additional PIP endorsement contained in N.Y. Comp. Codes R. & Regs. tit. 11, § 65-1.3 (Regulation 68) (2002), the No-Fault insurer must pay the full amount of lost wage benefits payable per month which are available under the additional PIP coverage purchased after the maximum amount of loss wage coverage available under basic economic loss is exhausted.

2. When a No-Fault insurer receives a claim for health services rendered from a health provider but has not received the required application for No-Fault benefits from the eligible injured person (the patient), it must forward the required application form to the patient for completion and submission to the insurer, as required under N.Y. Comp. Codes R. & Regs. tit. 11, § 65-3.4 (b) (Regulation 68) (2002).

FACTS PRESENTED:

With respect to the inquirer’s first question, an insured has mandatory PIP coverage which provides for a maximum of $2000 per month for lost wages as part of basic economic loss coverage. The insured has also purchased additional PIP No-Fault coverage, which makes $4,000 a month available to the eligible insured for lost wages, which is double the amount of lost wages available under basic economic loss. Under the situation described by the inquirer, the injured insured was collecting $4,000 in lost wages per month, of which $2,000 per month is being received from the $50,000 of available basic economics benefits, and an additional $2,000 per month under the Additional PIP coverage. Upon exhaustion of the $50,000 in basic economic loss benefits, the inquirer asks whether the injured person is entitled to the full $4,000 per month amount of lost wage benefits available under the remaining Additional PIP coverage, or is the benefit level for lost wages under Additional PIP coverage limited to $2,000 per month due to the exhaustion of basic economic loss coverage.

As to the second question, no facts were presented.

ANALYSIS:

  1. Pursuant to N.Y. Ins. Law § 5102 (a) (McKinney 2003), "Basic economic loss" means, up to fifty thousand dollars per person of the following items…" which includes, under Section 5102 (a)(2) "Loss of earnings from work which the person would have performed had he not been injured, and reasonable and necessary expenses incurred by such person in obtaining services in lieu of those that he would have performed for income, up to two thousand dollars per month for not more than three years from the date of the accident causing the injury." This section establishes a maximum of $2,000 per month that is made available to an eligible injured insured under basic economic loss, over a maximum period of three years, until such time as basic economic loss benefits are exhausted.

Under the prescribed Additional Personal Injury Protection (alternately referred to as "Extended economic loss") endorsement contained in N.Y. Comp. Codes R. & Regs. tit. 11, § 65-1.3 (Regulation 68) (2002), extended economic loss consists of the difference between basic economic loss and basic economic loss recomputed in accordance with the time and dollar limits, as set out in the declarations page.

Applying the statutory and regulatory provisions to the question presented by the inquirer, the policyholder purchased $4,000 per month in available lost wage benefits under Additional PIP coverage. Therefore, while $2,000 a month in lost wage benefits was available under basic economic loss, an additional $2,000 per month was made available under Additional PIP (the difference between the $4,000 dollar maximum purchased in extended economic loss and $2,000 available under basic economic loss). However, at the point when the $2,000 per month under basic economic loss was no longer available due to benefit exhaustion, assuming there was still was additional PIP coverage available, the eligible injured person would have been entitled to the full $4,000 per month available as extended economic loss (as the $4,000 per month was no longer being reduced by $2,000 in basic economic loss).

2. Pursuant to N.Y. Comp. Codes R. & Regs. tit 11, § 65-3.4 (b) (Regulation 68 (2002), "Unless the insurer will pay the claim as submitted within 30 calendar days, then, within five business days after notice is received by the insurer at the address of its proper claim processing office, either orally…or in any other manner, the insurer shall forward to the applicant the prescribed application for motor vehicle benefits (NYS Form N-F 2) accompanied by the prescribed cover letter (NYS Form N-F 1)…" (emphasis added).

Therefore, in the question posed by the inquirer, when the No-Fault insurer receives a claim for health services rendered from a health provider, but has not received the required application for benefits from the eligible injured person, the No-Fault insurer is required to notify and forward the application to the eligible injured person, for completion and submission to the insurer in a timely manner, so that the provider may be reimbursed.

For further information one may contact Supervising Attorney Lawrence M. Fuchsberg at the New York City Office.