PART III. PROVISION FOR TEMPORARY DISABILITY

INSURANCE BENEFITS

 

392-41 Provision for payment of benefits. (a) An employer or an association of employers shall secure temporary disability benefits for their employees in one or more of the following ways:

(1) By insuring and keeping insured the payment of temporary disability benefits with any stock, mutual, reciprocal or other insurer authorized to transact the business of disability insurance in the State; or

(2) By depositing and maintaining with the state director of finance, securities, or the bond of a surety company authorized to transact business in the State, as are satisfactory to the director securing the payment by the employer of temporary disability benefits according to the terms of this chapter; or

(3) Upon furnishing satisfactory proof to the director of the employer's or its solvency and financial ability to pay the temporary disability benefits herein provided, no insurance or security or surety bond shall be required, and the employer shall make payments directly to the employer's employees, as they may become entitled to receive the same under the terms and conditions of this chapter; or

(4) By a plan, entitling employees to cash benefits or wages during a period of disability, in existence on the effective date of this chapter.

(A) If the employees of an employer or any class or classes of such employees are entitled to receive disability benefits under a plan or agreement which remains in effect on January 1, 1970, the employer, subject to the requirements of this section, shall be relieved of responsibility for making provision for benefit payments required under this chapter until the earliest date, determined by the director for the purposes of this chapter, upon which the employer has the right to discontinue the plan or agreement or to discontinue the employer's contributions toward the cost of the temporary disability benefits. Any plan or agreement referred to in this subparagraph may be extended, with or without modification, by agreement or collective bargaining between the employer or employers or an association of employers and an association of employees; provided the benefits under the plan or agreement, as extended or modified, are found by the director to be at least as favorable as the disability benefits required by this chapter.

(B) Any other plan or agreement in existence on January 1, 1970, which the employer may, by the employer's sole act, terminate at any time, or with respect to which the employer is not obligated to continue for any period to make contributions, may be accepted by the director as satisfying the obligation to provide for the payment of benefits under this chapter if the plan or agreement provides benefits at least as favorable as the disability benefits required by this chapter and does not require contributions of any employee or of any class or classes of employees in excess of the amount authorized in section 392-43, except by agreement and provided the contribution is reasonably related to the value of the benefits as determined by the director. The director may require the employer to enter into an agreement in writing with the director that until the employer shall have filed written notice with the director of the employer's election to terminate such plan or agreement or to discontinue making necessary contributions toward the cost of providing benefits under the plan or agreement, the employer will continue to provide for the payment of the disability benefits under the plan or agreement. Any plan or agreement referred to in this subparagraph may be extended, with or without modification; provided the benefits under the plan or agreement, as extended or modified, are found by the director to be at least as favorable as the disability benefits required by this chapter; or

(5) By a new plan or agreement. On or after January 1, 1970, a new plan or agreement with an insurer may be accepted by the director as satisfying the obligation to provide for the payment of benefits under this chapter if the plan or agreement provides benefits at least as favorable as the disability benefits required by this chapter and does not require contributions of any employee or of any class or classes of employees in excess of the amount authorized in section 392-43, except by agreement and provided the contribution is reasonably related to the value of the benefits as determined by the director. Any such plan or agreement shall continue until written notice is filed with the director of intention to terminate the plan or agreement, and any modification of the plan or agreement shall be subject to the written approval of the director.

(b) During any period in which any plan or agreement or extension or modification thereof authorized under subsection (a)(4) or (5) provides for payments of benefits under this chapter, the responsibility of the employer and the obligations and benefits of the employees shall be as provided in the plan or agreement or its extension or modification rather than as required under this chapter; provided that:

(1) The employer or insurer has agreed in writing with the director to pay the assessments imposed by section 392-67; and

(2) If the benefits provided by the plan or agreement or extension or modification thereof include benefits falling within the definition of "sick leave" as defined in section 398-1, any amount in excess of the minimum statutory equivalent, as determined by the department, may be used for the purposes of chapter 398.

(c) If any plan or agreement authorized under subsection (a)(4) or (5) covers less than all of the employees of a covered employer, the requirements of this chapter shall apply with respect to the employer's remaining employees not covered under the plan or agreement.

(d) As used in subsection (a)(4) or (5), "benefits at least as favorable as the disability benefits required by this chapter" means the temporary disability benefits under any plan or agreement, in whole or in part, whose component parts (waiting period for illness, waiting period for accident, duration of benefits, and percentage of wage loss replaced) add in total to cash benefits or wages that are determined by the director to be at least as favorable as the disability benefits required by this chapter. The insurance commissioner shall establish a set of tables showing the relative value of different types of cash benefits and wages to assist the director in determining whether the cash benefits and wages under a plan are at least as favorable as the temporary disability benefits required by this chapter.

(e) Any decision of the director rendered pursuant to this section with respect to the amount of security required, refusing to permit security to be given or refusing to accept a plan or agreement as satisfying the obligation to provide for the payment of benefits under this chapter shall be subject to review on appeal in conformity with the provisions of this chapter.

(f) In order to provide the coverage required by this chapter for employers otherwise unable to obtain or provide such coverage, the insurance commissioner may, after consultation with the insurers licensed to transact the business of disability insurance in this State, approve a reasonable plan or plans for the equitable apportionment among such insurers of employer applicants for such insurance who are in good faith entitled to but are unable to procure such insurance through ordinary methods and, when such a plan has been approved, all such insurers shall subscribe thereto and participate therein; provided, however, that the commissioner shall not, for insurance issued or in connection with any such plan or plans, require or allow the use of premium rates which are either inadequate or excessive in relation to the benefits to be provided. Any employer applying for such insurance or any insured under such plan and any insurer affected may appeal to the commissioner from any ruling or decision of the manager or committee designated to operate such plan. All orders of the commissioner in connection with any such plan shall be subject to judicial review as provided in chapter 91.

(g) All insurers shall in form prescribed by the director notify employer applicants who are unable to procure the required insurance through ordinary methods, the availability of the plan described in (f) above. [L 1969, c 148, pt of 1; am L 1971, c 109, 1(d); am L 1978, c 200, 1; gen ch 1985; am L 2005, c 243, 1]

 

Attorney General Opinions

 

Where department essentially has two TDI plans (full-time teachers are covered by a plan approved by DLIR pursuant to subsection (a)(5), and department's A+ and other employees are paid benefits in accordance with TDI law found in chapter 392), if an individual is employed by department as both a full-time teacher and an A+ employee and the individual becomes disabled for both jobs, the department must pay the individual under both TDI plans. Att. Gen. Op. 97-9.

 

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