With days left to review the proposed NY Paid Family Leave regulations, what should you know?
NY Paid Family Leave, the most comprehensive Paid Family Leave program in the country, is set to go into effect January 1, 2018. But for employers and brokers preparing for the moment, the date isn’t as far off as it sounds. And employers can begin making payroll deductions as early as July 1, 2017. 
A Quick Recap of NY Paid Family Leave
First, a quick recap of the proposed regulations:
NY Paid Family Leave provides employees with the income they need to enable them to stay home and care for:
- a newborn, adopted or foster care child within the first 12 months
- an ill or aging family member
- children while a spouse is serving in the military
Paid Family Leave will be phased in over the next four years, until 2021, when PFL will pay out the maximum coverage of 67 percent of an employee’s average weekly wage for 12 weeks. Coverage will be community rated to promote a fair and efficient market, and coverage will be written as a rider to existing DBL policies.
You can learn more about the specific details of the law in this blog post, when The DBL Center blog broke the news to our network last April.
What We Know
In the past year, we’ve been staying on top of the news and we’ve discovered some interesting facts:
- Many employers don’t even know these new regulations were introduced.
- Some P&C brokers are considering leaving the DBL insurance industry because they are worried about the new regulations
- Brokers are turning to those in the know, such as reputable carriers and The D.B.L. Center, to answer questions they have and find the best ways to educate their customers
Embracing the Opportunities NY Paid Family Leave Offers to Brokers
Because PFL coverage will exist as a rider to current New York State mandatory DBL coverage, these changes affect P&C brokers who write DBL coverage. Brokers SHOULD look at the coverage as an opportunity.
The DBL Center and our carriers are here to help you leverage this opportunity for increased commissions (whatever the actual amount may be!) on mandatory, employee-funded PFL coverage. The process is one of education and consultative selling, rather than hard sales. And The DBL Center is here to assist every step of the way, with the information our brokers and their customers need to make the best decisions and guide you in this new claim process.
Our soon to be released mobile app, combined with the technical infrastructure provided by preferred vendors to process policy riders, gives our brokers the tools they need to be successful in this new venture.
It’s also a good time for our brokers to review and enrich existing DBL policies beyond the state minimum, in preparation for the Governor’s office to potentially increase the DBL benefit. After all, Governor Cuomo’s father Mario was the last one to increase the weekly indemnity back in 1989. We never know. Changes are ahead, and they promise to be good ones for brokers who work with The DBL Center as their insurance wholesaler and have the tools to take a consultative approach to selling DBL in New York.
Deadlines Approaching
But what are the rates for NY Paid Family Leave? And how much do brokers stand to make from the new PFL coverage? These are the top questions on the minds of many of our brokers. Certainly, the state acknowledges that brokers’ workloads will increase as a result of the new coverage, and industry experts believe rates will be fair to enable reasonable broker commissions. But right now, all we can do is expect the best.
The good news is that all the uncertainty ends on June 1, when the state announces the coverage rates. Soon after that, carriers will announce broker commissions. And employers are permitted to begin deducting payments for NY Paid Family Leave premiums beginning July 1.
In addition, brokers have until April 8 to read the draft regulations and make comments. The full text of the regulations can be found here.
Meanwhile, We Wait…
As we wait for the proposed regulations to pass and the State of New York to set the rate, it’s important to continue educating employers on the law. That way, when the time comes for them to purchase this mandatory coverage and, even before then, to begin making payroll deductions on July 1, they will know where to turn.
Stay tuned for further information regarding our Q&A seminar at The Friar’s Club next month in conjunction with The New York Business Council and one of our preferred vendors. With The DBL Center behind you, our brokers are poised to make the most of NY Paid Family Leave.
