New York State Insurance Fund: Workers’ Comp, DBL, and PFL

The New York State Insurance Fund, known as NYSIF, is a state-run insurance carrier that has covered New York employers since 1914. It writes workers’ compensation policies, disability benefits policies, and administers Paid Family Leave, letting an employer meet three separate legal obligations through a single carrier. It is the largest workers’ compensation insurer in the state, and any New York employer can buy a policy from it regardless of industry, size, or claims history.

What NYSIF Is

The legislature created the State Insurance Fund as part of the Workmen’s Compensation Act of 1914, which took effect on July 1 of that year.¹ Once workers’ compensation became mandatory, the state needed a carrier that would always be available to write a policy, including for employers a private insurer might turn away. That guaranteed-availability role is still NYSIF’s core purpose.

NYSIF is self-supporting. It collects premiums, invests the money, and pays claims and operating costs from the proceeds. It receives no tax dollars and no state appropriations. It also runs loss-prevention and workplace-safety programs for policyholders, on the theory that fewer injuries mean lower premiums.

The Three Coverages NYSIF Writes

Workers’ Compensation

Virtually all New York employers must carry workers’ compensation, including for part-time workers and family members on the payroll.² Employers meet this obligation by buying from NYSIF, buying from a private carrier, or self-insuring (uncommon, and it requires Board approval). A policy covers medical treatment, rehabilitation, and partial wage replacement for job-related injuries and illnesses.

Disability Benefits (DBL)

New York is one of a small number of states that require employers to provide short-term disability coverage for injuries and illnesses that happen off the job.³ This is separate from workers’ compensation and comes from Article 9 of the Workers’ Compensation Law.

The statutory benefit pays 50% of an employee’s average weekly wage over the last eight weeks worked, capped at $170 per week, for up to 26 weeks in any 52-week stretch. Benefits start on the eighth consecutive day of disability; the first week is an unpaid waiting period. The $170 cap has not changed for 2026.⁴ Employers can buy enhanced DBL policies from NYSIF or private carriers to provide higher weekly benefits, but only the statutory minimum is legally required.

Paid Family Leave (PFL)

Since 2018, most private employers in New York have had to provide Paid Family Leave, which runs through the same insurance policy as DBL. NYSIF administers both for its policyholders.

PFL covers three situations: bonding with a new child after birth, adoption, or foster placement; caring for a seriously ill family member (spouse, domestic partner, child, parent, grandparent, grandchild, or sibling); and assisting with qualifying needs when a spouse, domestic partner, child, or parent is deployed abroad on active military duty.⁵

Eligible employees can take up to 12 weeks of job-protected leave per year. The benefit pays 67% of the employee’s average weekly wage, capped at 67% of the statewide average weekly wage. For 2026, that cap works out to a maximum weekly benefit of $1,228.53.⁶

Unlike workers’ compensation and DBL, PFL is funded entirely by employee payroll deductions. In 2026, the contribution rate is 0.432% of wages per pay period, capped at an annual maximum of $411.91 per employee. Once an employee hits that cap, no further deductions come out for the rest of the year.⁷

Full-time employees (20 or more hours per week) become eligible after 26 consecutive weeks of employment. Part-timers working fewer than 20 hours qualify after 175 days worked, which do not have to be consecutive.⁸

Who Needs Coverage and Who Is Exempt

The default rule is straightforward: if you have employees in New York, you need workers’ compensation, disability benefits, and Paid Family Leave coverage. A few business structures fall outside that rule.

Workers’ compensation coverage is not required for sole proprietors with no employees, for partnerships, LLCs, and LLPs with no employees (partners and members are not treated as employees), or for one- or two-person corporations where those individuals own all stock, hold all corporate offices, and have no other workers of any kind, including day laborers, leased workers, volunteers, or subcontractors.⁹ Any of these owners can still opt into coverage voluntarily.

If you are exempt and need to prove it when applying for a government license, permit, or contract, you file a Certificate of Attestation of Exemption (Form CE-200) through New York Business Express. A CE-200 is specific to each license, permit, or contract, so a separate one is needed for each application.¹⁰ It cannot be used to respond to the Board about compliance penalties or to show another business you don’t need coverage.

One boundary worth flagging: calling a worker an “independent contractor” does not make them one. In construction, New York’s Fair Play Act applies a strict three-part test. The worker must be free from direction and control, the work must be outside the hiring company’s usual business, and the worker must have an independently established business. Fail any prong and the worker is an employee who must be covered.¹¹

How NYSIF Sets Premiums

Workers’ compensation premiums depend on three main factors: the classification of the work being performed, the employer’s payroll, and the employer’s claims history.

Every type of work has a classification code. The New York Compensation Insurance Rating Board (NYCIRB) publishes a loss cost for each classification, reflecting expected claim costs per $100 of payroll. Each carrier then multiplies the loss cost by its own loss cost multiplier, approved by the Department of Financial Services, to account for expenses, overhead, and profit.¹² The result is the per-$100-of-payroll rate the employer actually pays.

Once an employer has enough history (typically three years), NYCIRB calculates an experience modification factor comparing that employer’s actual losses to the expected losses for its classification. Below-average claims produce a modifier under 1.0, which lowers premiums. Worse-than-average claims produce a modifier above 1.0, which raises them.¹³ Investing in workplace safety translates directly into a lower premium here.

NYSIF also runs a safety group program that pools employers in similar industries. Members share the group’s collective risk, often receive advance premium discounts, and can earn dividends when the group’s claims come in below expectations. NYSIF has paid billions in cumulative dividends to safety groups since the program started in 1923.¹⁴ Healthcare employers that comply with the Safe Patient Handling Act can receive a 2.5% premium credit on applicable classification codes.¹⁵ NYSIF offers annual, quarterly, and monthly payment plans, all handled through its online portal.

Reporting Injuries and Filing Claims

For a workers’ compensation claim, the employer reports the injury. For anything beyond a minor injury (one requiring no more than two treatments and no lost time beyond the work shift), the employer must file a report on or before the 18th day after the injury, or within 10 days of learning of it, whichever is later. Missing that deadline is a misdemeanor and can carry a fine of up to $2,500.¹⁶

Reporting the injury to NYSIF satisfies the Board reporting obligation.¹⁷ If the injury involves lost time beyond the initial shift or more than two treatments, the employer must file a separate claim with both NYSIF and the Board immediately. After receiving the report, NYSIF assigns a claims adjuster to review the incident and medical documentation and determine what benefits apply.

DBL and PFL claims work differently. The employee starts them. For DBL, the employee submits a notice of disability to the employer within 30 days of becoming disabled, and the employer forwards the claim to its carrier. For PFL, the employee notifies the employer at least 30 days before leave begins (or as soon as practicable for unforeseeable events) and submits the required forms to the carrier.

Payroll Audits

NYSIF audits policyholders regularly to verify that the payroll reported on the policy matches what the employer actually paid out. Because premiums are based on payroll, underreporting means underpaying, and NYSIF will collect the difference plus any penalties.

During an audit, NYSIF typically asks for payroll books, payroll tax returns (Forms 941, NYS-45, NYS-45-ATT), employee tax forms (W-2, W-3, 1099, 1096), cash disbursement records, the general ledger, business income tax returns (Forms 1120, 1065, 1040, 990), certificates of insurance for subcontractors, and contracts and invoices for labor and services.¹⁸

The subcontractor piece trips up a lot of employers. If a subcontractor cannot produce a certificate of insurance, NYSIF treats that subcontractor’s workers as the hiring employer’s employees for premium purposes, which can push the audit bill up sharply. Keeping current certificates of insurance on file for every subcontractor is one of the easiest ways to avoid a surprise audit adjustment.

Penalties for Going Without Coverage

New York treats the failure to carry required insurance as a serious offense, and penalties escalate fast.

Workers’ Compensation

Criminal penalties for operating without workers’ compensation coverage depend on workforce size. With five or fewer employees, it is a misdemeanor with a fine of $1,000 to $5,000. With more than five employees, it is a class E felony with a fine of $5,000 to $50,000. A repeat offense within five years is a class D felony with a fine of $10,000 to $50,000, on top of any other penalties.¹⁹

On top of criminal penalties, the Board imposes civil fines of up to $2,000 for every 10-day period without coverage. Uninsured employers that have a claim filed against them face additional assessments at the same $2,000-per-10-day rate.²⁰ The Board can also issue a stop-work order requiring the immediate halt of all business operations until coverage is obtained and any outstanding debts to the Board are paid.²¹

Intentionally understating payroll or concealing employees to lower premiums carries a civil penalty of up to $2,000 for every 10-day period of noncompliance. Simply maintaining inaccurate payroll records can result in a $1,000 penalty for each 10-day period.²⁰

Disability Benefits

Employers who fail to provide disability benefits coverage within 10 days of becoming a covered employer also face criminal and administrative penalties. A first offense is a misdemeanor with a fine of $100 to $500, up to one year of imprisonment, or both. A second offense within five years carries a fine of $250 to $1,250. A third or later offense carries a fine of up to $2,500. The Board chair can also impose an administrative penalty of up to 0.5% of the employer’s weekly payroll for the uncovered period, plus an additional sum of up to $500.²²

Resolving Disputes

Disagreements over claims are common. An employer may dispute whether an injury is work-related; an employee may believe the benefits offered are too low. The Workers’ Compensation Board handles these disputes. Its claims examiners and conciliators try to resolve issues informally first. If that does not work, the case goes to a hearing before a workers’ compensation law judge, who takes testimony, reviews medical records and wage information, and issues a decision on the claim and any award.²³ Many hearings are conducted virtually, and either side can appeal the judge’s decision through the Board’s appeals process. Parties can also settle a claim outside the hearing track through a negotiated Section 32 agreement, which resolves the claim for a lump sum.

1
New York State Insurance Fund. The NYSIF Century
2
Workers’ Compensation Board. Is Workers’ Compensation Coverage Required?
3
Workers’ Compensation Board. Disability Benefits Coverage and Eligibility
4
New York State Insurance Fund. NYSIF Lowers Standard Disability Benefits Premium Rate in 2026
5
New York State Paid Family Leave. Paid Family Leave
6
New York State Paid Family Leave. New York Paid Family Leave Updates for 2026
7
Department of Financial Services. Decision on Premium Rate for Paid Family Leave Benefits and Maximum Employee Contribution for Coverage Beginning January 1
8
Paid Family Leave. Eligibility
9
Workers’ Compensation Board. Workers’ Compensation Coverage For-Profit Businesses
10
Workers’ Compensation Board. Certificate of Attestation of Exemption (CE-200)
11
Department of Labor. Construction Industry Fair Play Act
12
New York Compensation Insurance Rating Board. Rule VI – Loss Cost Multiplier
13
New York Compensation Insurance Rating Board. New York Experience Rating Plan Manual
14
New York State Insurance Fund. NYSIF Insurance Plans
15
New York Compensation Insurance Rating Board. New York Safe Patient Handling Act Program Explanatory Endorsement
16
Workers’ Compensation Board. What to Do When an Injury Happens
17
New York State Insurance Fund. Employer’s Role in Workers’ Comp Claims
18
New York State Insurance Fund. Documents Required for Payroll Verification
19
New York State Senate. New York Workers’ Compensation Law 52 – Effect of Failure to Secure Compensation
20
Workers’ Compensation Board. Violations of Workers’ Compensation Law (Liability and Penalties)
21
New York State Senate. New York Workers’ Compensation Law 141-A – Civil Penalty for Failure to Provide Coverage
22
New York State Senate. New York Workers’ Compensation Law 220 – Penalties
23
Workers’ Compensation Board. Hearings, Agreements and Appeals