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General Contractor’s New York Insurer Must Pay Benefits Where Subcontractor’s Insurer Provided Coverage Only in New Jersey

Blogs, Insurance Coverage

Last month, a New York Appellate Division court ruled that a general contractor’s workers’ compensation insurer was responsible for paying benefits resulting from the death of a subcontractor’s employee in New York where the subcontractor’s insurer only provided coverage in New Jersey. In the Matter of Estate of Velasquez v. NGA Construction Co., No. 516773, 2013 WL 6283729 (N.Y. App. Div. 3d Dep’t Dec. 5, 2013). 

In Velasquez, M&L Enterprises, LLC (“M&L Enterprises”) subcontracted with a New Jersey company, NGA Construction Co. (“NGA”), to install siding on a building in Brooklyn, New York. While working on the project, one of NGA’s employees fell from a scaffold, causing injuries that ultimately resulted in his death. After finding that the employee had suffered a work-related injury resulting in his death, the New York State Workers’ Compensation Board found that the workers’ compensation policy issued to NGA by its insurer did not provide coverage in New York and, thus, the workers’ compensation carrier for M&L Enterprises was liable for coverage.

The Appellate Division affirmed, noting that Workers’ Compensation Law § 50(2) required NGA to obtain “a full, statutory New York State workers’ compensation insurance policy” that listed New York in Item 3A of the Information Page. Because NGA failed to do so, the Court upheld the Board’s determination requiring the carrier for M&L Enterprises to pay benefits.

For a full copy of the Appellate Division’s decision click here