Statutory Disability & Paid Family Medical Leave

Statutory Disability/ Paid Medical Leave:

Insurance coverage mandated by a state which provides weekly income replacement if an employee is disabled on a short-term basis due to injury or sickness not related to work.

Paid Family Leave

Job-protected coverage for an employee to bond with a newborn, adopted or foster care child during the first 12 months; care for a seriously ill family member; or address important needs related to a family member’s military service.

General Information

• Based on work state

• Non-Occupational Coverage

• Leasing Firms and Temporary agencies are automatic no-quotes 

• Non-profit organizations are required to provide Statutory STD

• Municipalities, towns, school districts are not required to provide statutory STD

• Part-time employees are included, except for high school part-timers

• No booklets are issued on statutory standalone; endorsement only

• Mostly Self-Administered vs. List Bill.

• Typically billed quarterly; other frequencies available

• ASO (separate policy from Core)

• Fully credible at 500 life years

STAT/PFML Product Landscape (Offering both fully-insured and self-insured (ASO) coverage (unless indicated otherwise)

• California (CAVPDI/CAVPFL- approved plans > 100 lives) (ASO only)

• Colorado (PFML)

• Connecticut (PFML)

• Delaware (FMLI)
  Hawaii (TDI)

• Maryland (FMLI 1/1/28)

• Massachusetts (PFML)

• Minnesota (PFML 1/1/26)

• New Jersey (TDB/ FLI)

• New York (DBL/PFL)

• Oregon (PFMLI)

• Vermont (FMLI/FLI 7/1/24)

• Virginia (PRML 12/1/2028)

• Washington (PFML) (ASO only)

Why Private Carrier Coverage?

• Better claims customer service

• Experience reporting available

• Enriched plan design options

• W-2 & FICA services

• East of administration

• PAR available

• Administration Services for self-insured plans

• Billing & Payment frequency options (ie. Monthly)

• TPA Claims Service

UW Things to Consider

• Plan Designs are set/mandated by State

• Billing Modes

  • STAT/PFML products standard billing mode includes Quarterly (in arrears).

  • Structure makes it difficult to for Premium Audit Team to complete a review until 9 months after eff. date

• Salary Continuation / PTO Top Off

  • UWs should be asking these questions on every single STAT/PFML presale/renewal.

  • Answers are rate-bearing.

• Pricing Methodology

  • Priced in the AMT, similar to Short Term Disability

  • PML and PFL are evaluated separately but priced on a combined basis

  • Competitors provide combined experience, which needs to be broken out

• Rate Guarantees

  • For PFML products, if more than 1 year is being requested, Actuarial must be consulted to ensure prospective benefit trend loads are properly being applied.

  • AVP must provide UW approval.

• Rate Basis Considerations

PEPM - Rate Basis

Description: Monthly Volume = # of Lives

Standard Products: Most common basis for NY DBL

Per $10 Weekly Benefit- Rate Basis

Description: Monthly Volume = Weekly Salary x Benefit % then capped at the maximum benefit amount

Per $100 Covered Payroll

Description: Monthly Volume = Monthly salaries capped based on the coered payroll (convert the weekly benefit maximum to a monthly value: Benefit Max * 52 weeks/12 months

Standard Products:Most common basis for HI TDI

% of Taxable Wages

Description: Monthly Volume = Annual Salary, not the exceed the wage basis determined by the state (volume is not related to plan design)

Standard Products: Most common basis for PFML