December 31, 1984
SUBJECT: INSURANCE
(EFF. 12-4-03)
DATED: DECEMBER 31, 1984
SUPPLEMENT NO. 4 TO CIRCULAR LETTER NO. 16 (1981)
WITHDRAWN
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 |
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EMPLOYER |
COVERED EMPLOYEES AND BENEFITS |
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ARCO Metals Co. |
Hourly Employees - Entitled to up |
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to $ 145 per week for up to 26 |
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weeks per disability. Salaried |
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Employees - Entitled to full |
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salary for up to 6 months per |
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disability, after one year of |
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service. |
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Bedford Central School |
Teachers on Tenure. Maximum of |
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District |
2 years at full pay. |
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** Boys" Club of New York |
All employees with a least six |
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months of service. From 2 to 26 |
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weeks at full pay dependent upon |
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length of service. |
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*** Chevrolet, Inc. |
All employees represented by the |
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U.A.W. with one year or more of |
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service are entitled to benefits |
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for 52 weeks equal to |
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approximately 60% of the |
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employee's weekly salary, as set |
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forth in schedule of benefits |
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contained in U.A.W. contract. |
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Corning Glass Works |
Hourly Roll Employees - Entitled |
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to an "Enriched Disability |
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Plan", which provides up to $ 160 |
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per week for a maximum of 26 |
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weeks per disability. |
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Other Than Hourly Roll Employees - |
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Entitled to from 1 to 26 weeks |
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of full pay per disability, |
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depending upon length of |
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service. The "Enriched |
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Disability Plan" (see hourly |
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roll employees above) is used |
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(up to $ 160 per week maximum) |
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only to supplement the wage |
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continuation benefit when full |
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salary benefits have been |
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exhausted. Insurers must |
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ascertain the number of weeks to |
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which the eligible injured |
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person is entitled. |
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Depository Trust Co. |
Professional, administrative, |
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supervisory employees, guards |
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and confidential secretaries are |
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entitled to full salary for up |
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to 180 days. |
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* Federal District Court |
Justices only. |
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** F.M.C. Corporation |
Hourly Employees only. Full |
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time hourly employees with at |
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least 12 months service: 13 to |
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58 weeks, dependent upon length |
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of service; payable at 85% to |
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100% of salary, dependent upon |
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length of disability. |
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Ford Motor Co. |
See Chevrolet (above) |
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G.A.T.X. Corp. |
All employees. From one to six |
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(American Steamship Corp.) |
months at full pay; or |
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combination of full pay and 2/3 |
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pay for a maximum of six months, |
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depending upon length of service. |
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General Electric Co. |
All employees. Level I benefits- |
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20 days each 12 months, at full |
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pay. No-Fault insurers are |
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required to pay full no-fault |
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benefits (no reduction) when |
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this benefit period is utilized, |
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since as the time is used, it is |
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lost. However, insurers are |
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entitled to the applicable |
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weekly disability offset. |
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Level II Benefits - Payable only |
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after Level I Benefits have been |
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exhausted. Benefits are equal |
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to 60% of employee's weekly |
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salary up to a maximum weekly |
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benefit of $ 200 for up to 26 |
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weeks. |
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* Greenwich Fixture Co. |
Officers of the company not |
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covered by the union plan. |
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** Gulf & Western Industries. |
From 1 to 26 weeks, dependent |
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upon length of service; payable |
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at 60% to 100% of salary, |
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dependent upon length of |
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disability. |
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** Houdaille Industries, |
Full time permanent salaried |
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Strippit Division |
employees: 90 days at 100% of |
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basic salary, followed by 90 |
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days at 50% of basic salary. |
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Ingersoll - Rand Co. |
Union employees - $ 145 per week |
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for a maximum of 52 weeks. |
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Salaried Employees - Full |
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salary for 3 to 26 weeks; or |
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combination of full pay and 60% |
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of salary for a maximum of 26 |
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weeks, depending upon length of |
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service. |
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** John Hancock Mutual |
District Agents Only. From 8 to |
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Life Ins. Co. |
104 weeks, dependent upon length |
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of service; 100% of salary for |
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first week, 2/3 of salary for |
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remaining period of eligibility. |
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* Village of Mamaroneck, |
Police Officers. |
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N.Y. |
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* Manhasset Union Free |
All professional personnel |
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School District |
including teaching and |
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administrative staff. |
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Motorola, Inc. |
All employees, after 1 year of |
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service are entitled to: 1. 90 |
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days at full pay; and 2. next 90 |
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days at half pay. |
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* New York City |
Employees in the uniformed |
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services of Police, Fire, |
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Corrections and Sanitation |
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Departments only. |
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New York State Electric |
Hourly Employees - (with more |
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and Gas Corp. |
than 6 months service) - |
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entitled to 85% of basic |
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earnings (40 hour week) for up |
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to 26 weeks per disability. |
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Salaried Employees - Entitled |
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to full salary for a specified |
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period of time, based on length |
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of service. Insurer must |
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ascertain benefit period |
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eligible injured person is |
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entitled to. |
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Niagara Mohawk Power |
All employees. Benefits are |
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payable for up to 26 weeks at |
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100% of salary. |
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Occidental Chemical Corp. |
All employees (after successful |
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completion of probationary |
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period) - 55% of base salary for |
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a maximum of 26 weeks per |
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disability. |
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J.C. Penney |
All employees working more than |
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20 hours per week (after 13 |
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weeks of service) - Combination |
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of full pay and 1/2 pay for a |
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maximum of 26 weeks, depending |
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upon length of service, after a |
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waiting period of 0-5 days, |
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depending upon length of service. |
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Prudential Property and |
All Employees: (Level I) 10, 15, |
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Casualty Ins. Co. |
or 20 days at full pay per year |
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depending upon length of |
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service. (Level II) Payable |
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only after initial period |
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benefits have been exhausted. |
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Benefits are equal to: (1) 75% |
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of base salary for employees |
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with less than 5 years of |
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service, payable for up to 26 |
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weeks per disability; or (2) 90% |
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of base salary for employees |
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with 5 or more years of service, |
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payable for up to 52 weeks per |
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disability. |
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** Remington Arms Co. |
All employees with at least one |
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year of continuous service. |
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Full wages for a maximum of 6 |
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months. |
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Reynolds Metals Co. |
Employees with less than 2 years |
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of service - up to 26 weeks per |
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disability. Employees with more |
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than 2 years of service - up to |
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104 weeks per disability. |
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Benefits range from $ 235 per |
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week to $ 303 per week, depending |
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upon an employee's "Insurance |
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Class". |
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** Savin Corporation |
All permanent, full time, |
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non-union employees with at |
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least 90 days continuous |
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service. From 2 to 26 weeks at |
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100% of salary, or combination |
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of 100% and 66 2/3%, dependent |
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upon length of service. |
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Stauffer Chemical Co. |
All Employees. Benefits are |
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payable for up to 6 months (3 |
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months for employees with less |
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than one year's service) at 100% |
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of salary. |
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** Sterling Drug, Inc. |
All salaried employees who |
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regularly work at least 20 hours |
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per week. From one-half to six |
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months at 100% of salary, or |
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combination of 100% and 60% |
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(dependent upon length of |
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service), commencing on the |
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eighth calendar day of absence. |
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* U.S. Armed Forces |
All members of the Armed Forces. |
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Westinghouse Electric Corp. |
All employees scheduled to work |
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24 or more hours per week are |
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entitled to approximately 60% of |
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weekly salary up to a maximum of |
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$ 225 per week for up to 26 weeks |
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per disability. |
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* City of Yonkers, N.Y. |
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Police Officers. |
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* Unlimited sick leave plans providing full salary for |
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the duration of disability. |
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** Plans reviewed since Supplement No. 3 was issued |
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(November 2, 1983). |
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*** Applies to employees of all divisions of General |
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Motors who are represented by the U.A.W. |
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NON-QUALIFIED PLANS |
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Alliance Tool Corp. |
Fisher - Price Toys |
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** Almor Corp. |
** Genesee Nursing Home |
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** American Airlines |
W.W. Granger, Inc. |
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Amos Post, Inc. |
** Graphic Controls Corp. |
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** A.S.C.A.P. |
** Halcon SD Group, Inc. |
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Associated Metals and |
Harris Corp. |
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Minerals Corp. |
Hart Schaffner and Marx |
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** Town of Babylon |
(Wallachs) |
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** Bankers Life & Casualty |
I.B.M. |
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Co. of N.Y. |
International Telephone and |
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** Bethlehem Steel Corp. |
Telegraph Corp. (ITT) |
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Bristol Labs a.k.a. Bristol |
Ivy Hill Corp. |
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Myers |
** Janney Montgomery |
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** The Brookdale Hospital |
Scott Inc. |
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Medical Center |
** Leviton Manufacturing Co. |
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** Buffalo Color Corp. |
Lightron of Cornwall, Inc. |
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Buffalo Envelope |
Longines - Wittnauer Watch Co. |
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** Carpenter Technology Corp. |
MacMillan, Inc. |
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C.D.I. Corp. |
Management Assistance, Inc. |
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Celanese Corp. |
Montgomery Ward |
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** CIBA-GEIGY CORP. |
M.O.N.Y. |
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Community Savings Bank |
** Morgan Guaranty Trust |
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Computer Task Group |
Co. of N.Y. |
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Consolidated Edison Co. |
** Nassau Recycle Corp. |
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** Control Data Corp. |
National Bulk Carriers |
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** Dairylea Cooperative Inc. |
Nationwide Insurance Co. |
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Dellwood Foods, Inc. |
Nestle |
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Dobbs Ferry U.F.S.D. |
** New York Air Brake Co. |
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Eastman Kodak |
New York Daily News |
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Elmira College |
New York State Employees |
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** The Equitable Life |
New York Telephone Company |
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Assurance Society |
New York Times |
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** Price Chopper Supermarkets |
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Rochester Telephone |
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** St. Elizabeth Hospital (Utica) |
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So. Huntington Schools |
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U.F.S.D. # 13 |
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Sperry Rand |
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State University of New York |
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Syosset General School District |
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** United States Postal Service |
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Western Electric |
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NOTE: If an employee covered by a non-qualified |
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plan is eligible for New York State |
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Disability Benefits, the insurer is entitled |
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to an offset pursuant to Section |
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5102(b)(2)[formerly Section 671(2)(b)] of |
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the Insurance Law. |
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** Plans reviewed since Supplement No. 3 was issued |
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(November 2, 1983) |