What Is Action Over / NYLL Coverage?

Action Over / New York Labor Law (NYLL) coverage is a specific type of insurance provision particularly relevant in the construction industry, and most critically applicable within the state of New York due to its unique labor laws. Understanding this term involves breaking down its two components: "Action Over" and "NYLL."

New York Labor Law (NYLL):
New York Labor Law sections 200, 240, and 241, often referred to collectively as the "Scaffold Law," impose strict liability on employers and property owners for gravity-related injuries that occur on construction sites. This means that if a worker is injured due to a fall from a height or by an object falling on them, the employer or property owner is liable for damages without the injured party having to prove negligence.

NYLL coverage is sought after due to these stringent laws. It provides protection for employers, contractors, and property owners against claims arising from construction-related accidents as dictated by the New York Labor Laws.

Action Over Claims:
"Action Over" refers to claims that arise when an employee is injured on the job and, after collecting workers' compensation, decides to sue a third party (who could be a property owner, general contractor, or another party involved in the project) claiming that the third party's negligence contributed to their injury. This can often involve situations covered under NYLL.

Because workers' compensation laws prohibit employees from suing their direct employers for workplace injuries, these claims "action over" to another party who can be held liable. For example, if a subcontractor's employee is injured due to purported negligence on the part of the general contractor or the property owner, the injured employee might seek damages from those parties.

Action Over / NYLL Coverage:
This specific coverage is designed to protect businesses from the above-described claims. It addresses the increased liabilities faced in New York due to the Scaffold Law, providing a safety net against severe financial consequences stemming from gravity-related injury claims. Without this coverage, companies and property owners operating in New York could face significant financial risks given the potential for high damages awards in labor law claims.

For insurance professionals handling policies in the construction sector, particularly those operating in New York, understanding the nuances of Action Over / NYLL coverage is crucial. It helps in effectively managing risk and ensuring that their clients are adequately protected against the unique set of liabilities presented by New York's labor laws.

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09/12/2024