NY self-insurer workers comp bonds.
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What the self-insurer security deposit actually guarantees

New York employers must provide workers’ compensation, disability and Paid Family Leave coverage. WCL Article 4 § 50 names self-insurance as one way to do it, and Article 9 § 211 does the same for disability and PFL. The Board is blunt about the terms: self-insurance is a privilege, and an approved self-insurer agrees to make benefit payments to injured employees and meet every other obligation under the Board’s laws, rules and regulations. Each entity files its own application — a subsidiary is not covered by its parent’s approval.

Because there is no carrier standing behind the promise, the Board takes security. All qualified self-insurers except political subdivisions must post a deposit with the Board in the form of cash, an irrevocable letter of credit, and/or a surety bond, to be used if the self-insurer defaults on paying benefits. Where an employer posts a mix, the statute sets the order: the Chair applies the securities, cash and letters of credit first, and only when those are exhausted requires the surety to pay the penal sum of the bond.

The amount is whatever the Chair determines is necessary. Effective 1 July 2026 the minimum security deposit for workers’ compensation self-insurers is $1,999,000; the minimum for disability self-insurers is $10,000, and $11,000 where Paid Family Leave is included. It is not set once — every year you remain self-insured the deposit is reviewed for adequacy against your annual reports and current rates, and you must top it up to the level the Board determines. The deposit also does not come back the day you stop self-insuring: claims keep running, so the Board holds the security for as long as it judges warranted.

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