Decision on Premium Rate for Paid Family Leave Benefits and Maximum Employee Contribution for Coverage Beginning January 1, 2027

This Decision sets forth the Superintendent’s determination regarding the premium rate for Paid Family Leave benefits for the 2027 calendar year, pursuant to Insurance Law § 4235(n)(1).

Introduction

Under New York’s Paid Family Leave program, all eligible employees in New York have been able to take time off, while still being paid a portion of their wages, to bond with a new child, to care for a family member with a serious health condition, or to handle personal matters arising from an immediate family member being called to active duty in the Armed Forces of the United States. Beginning in 2021, eligible employees receive 67% of their average weekly wage, up to 67% of the statewide average weekly wage for up to 12 weeks of leave.

As provided by Insurance Law § 4235(n)(1), in a decision dated June 1, 2017, the Superintendent, in consultation with the Chair of the Workers’ Compensation Board, determined that paid family leave benefits coverage issued pursuant to Article 9 of the Workers’ Compensation Law (“Paid Family Leave benefits”) shall be community rated. Community rating ensures that all employees are similarly treated and are not subject to cost variations based upon age, gender, geographic location, or any other demographic factor.

Insurance Law § 4235(n)(1) provides that the Superintendent shall establish the premium rate for community rated family leave benefits coverage, applying commonly accepted actuarial principles. Specifically, the Superintendent shall, by September 1 of each year, publish the rate for the policy period beginning on the following January 1. The Superintendent shall also set the maximum employee contribution for Paid Family Leave benefits pursuant to Workers’ Compensation Law § 209(3)(b). The maximum employee contribution is the maximum amount a covered employer is authorized to collect from each of its employees to fund Paid Family Leave benefits. The maximum employee contribution shall equal the premium rate for Paid Family Leave benefits.

2027 Premium Rate for Paid Family Leave Benefits and Maximum Employee Contribution

In determining the community rate for 2027, DFS has reviewed claims, demographic, financial and other Paid Family Leave benefits data for calendar years 2018 - 2025 and for the first six months of 2026 for the Paid Family Leave program in New York, consistent with actuarial principles. DFS also has reviewed claims and demographic data for New York’s disability coverage, as disability insurers are required to include Paid Family Leave benefits coverage as a rider to their disability policies. In addition, DFS has reviewed available data from other states with enacted paid family leave programs (New Jersey, California, Rhode Island, and states of Massachusetts, Connecticut and Washington which more recently enacted paid family leave programs), adjusting for differences between the programs in those states and New York State’s Paid Family Leave program. DFS also has reviewed information and data from the New York State Department of Labor, the United States Census Bureau, and other relevant sources.

To predict the Paid Family Leave benefits claims for the 2027 calendar year, DFS considered all relevant actuarial factors, including but not limited to:

1. Paid claims experience data from the Paid Family Leave program in New York in calendar years 2018 - 2025 and in the first six months of 2026 with claim runouts through June 30, 2026, and historical experience data from similar programs in other states, with adjustments for differences in benefits and events that had occurred but were not yet reported.
2. Data analyzed separately by gender and separately for Bonding, Family Care and Military coverage included:
   1. Average claim frequency factors.
   2. Annualized increases in average claim frequency factors.
   3. Average weekly benefit factors.
   4. Distribution of claims by duration and average claim duration factors; and
   5. Average covered payroll of the population making payroll contributions to the program.
   6. Changes in the numbers of covered workers from one calendar year to the next calendar year.
3. Anticipated rise in utilization due to the increase in the amount of the New York State Average Weekly Wage (NYSAWW) in calendar year 2027.
4. Calculation of aggregate claims costs for newborn, adoptive, and foster care bonding, family care and military leave.
5. Adjustment for commissions, other acquisition expenses, claim adjudication expenses, premium taxes, and administrative expenses, as analyzed from quarterly reports submitted by insurers to DFS, which quarterly reports indicate that total expenses as a percentage of earned premiums amount to about 20%.

The premium rate, like the benefit amount, is set as a percentage of an employee’s covered wage.

Thus, the premium paid by an employee depends on how much an employee earns: those earning less will pay a lower premium, and those earning more will pay a higher premium as they are eligible for higher benefits, up to the maximum Paid Family Leave Benefit for 2027 of 67% of the statewide average weekly wage. Employees whose income is at or above the statewide average weekly wage are eligible only for the maximum Paid Family Leave Benefit amount.

Accordingly, based on commonly accepted actuarial principles, the Superintendent has determined that the premium rate for Paid Family Leave benefits for coverage beginning January 1, 2027, shall be increased by +4.55% as compared to the premium rate applicable for calendar year 2026. This includes +0.50% for a change in benefit provisions that takes effect in calendar year 2027, as workers in the construction industry would not be subject to the 26 consecutive weeks of work with the employer immediately preceding eligibility for Paid Family Leave benefits as applicable to new workers. Rather, the construction industry is eligible for Paid Family Leave benefits when they were employed for at least 26 of the last 39 weeks.

The 2027 Paid Family Leave rate will be set at 0.452% of an employee’s wages each pay period up to and not to exceed an annual maximum employee contribution of $451.81. If an employee’s contributions reach the annual maximum employee contribution of $451.81 before the end of the calendar year, the employee shall not be liable for any additional contributions for that year. Employers shall collect employee contributions consistent with this Decision.

The maximum employee contribution of $451.81 in calendar year 2027 is +9.69% above the maximum employee contribution of $411.91 in calendar year 2026, reflecting the combined impact of the increase of +4.55% in the Paid Family Leave rate and the increase of +4.83% in the New York State average weekly wage.

All insurers offering Paid Family Leave benefits coverage in New York are requested to forward all Paid Family Leave benefits policy forms and rate submissions through the SERFF filing process. Policy forms and rate submissions are due October 1, 2026. Insurers are directed to the DFS website for submission instructions, the Model Rider, and the PFL checklist.

Dated: August 31, 2026