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Insurance problems and cures

Workers Compensation Insurance Change – New York

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The context for this is that New York State had changed its regulations regarding Workers Compensation Insurance in 2007. In essence, incidental time in New York for any employee of a firm outside NY might, and significant time would, trigger penalties if that company did not have NY on line 3A of their Workers Compensation Insurance.  We saw clients threatened with fines for $20,000 and up.

Line 3C provides “all other states” coverage for incidental exposures. Line 3A lists specific states. NY began demanding Line 3A listing for truly incidental exposure and fining companies when the State caught that exposure. The current change, though still more restrictive than most states, reduces some of the pressure. Our thanks to the Professional Insurance Agents of New Jersey ( ) for much of this information and for working with NY State to get this improvement. 

Please note that routine deliveries or other activity in NY by a company based in New Jersey could still require Line 3A coverage and trigger fines for all the time there was activity without Line 3A coverage.  Go to our website ( or our Workers Compensation page ( ) for more info or call us at 1-800-548-2329 .

On Nov. 22, 2010, the New York Workers’ Compensation Board (WCB) issued Subject No. 046-454, which carves out some Item 3.A. coverage exemptions for out-of-state employers having incidental or temporary work in New York. This is a significant change from the rigid Item 3.A. coverage requirement adopted by the WCB following the 2007 Workers’ Compensation Reform legislation.

Out-of-state employers who have Item 3.C. coverage will now be in compliance with insurance requirements (and not subject to enforcement penalties) as long as the employer:
1) is not required to register with the state Department of Labor and pay unemployment insurance for any period in question (see for details);
2) has no permanent physical location in New York or has no employees whose primary work location is in New York;
3) is not operating in New York under a permit, contract or license granted by the state of New York, its counties or any municipality as defined under Section 57 of the Workers’ Compensation Law;
4) is not working as a contractor/general contractor/subcontractor on a construction project in New York; and
5) had no employees physically in New York the previous year for at least 40 hours of every week for a period longer than two consecutive weeks, or had no employees present in New York for 25 or more individual days (e.g., five employees working for five days in New York equals 25 individual employee days). Note that when employees travel through the state without stopping for deliveries, pick-ups or other work, it is not considered a work day.

If the insurer providing Item 3.C. coverage is not authorized in New York, new Form C-105.11 will be required to be completed by the insurer. The WCB will post on its website a list of all carriers that have filed the Form C-105.11, and will provide periodic updates to such listing.
While more restrictive than many surrounding states, this change in enforcement standards is a welcome improvement for employers conducting incidental and temporary work in New York.

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