Greedy Attorneys & Docs Cheat Real Injured Workers
I think it’s easily understood by everyone that writing construction insurance policies and running a casino or sports betting site are both a gamble. Most of the time you win (insurers collect premiums but pay no claims and gamblers don’t hit the jackpot) but sometimes you lose (a big insurance claim is paid or someone wins the jackpot). Both industries are full of risk and reward. However, New York is building casinos and expanding sports gambling at a crazy pace while insurance companies are running for the hills. Why is that? The answer is really quite simple.
In New York, we have Labor Law 240/241, often referred to as the Scaffold Law. Before anyone gets the wrong impression, the law is not about scaffolds or scaffolding. This antiquated, last in the nation law establishes an absolute liability standard “for gravity related accidents” making it nearly impossible for owners, contractors and insurance companies to defend themselves. They are assumed guilty and have little chance to prove their innocence. The law encourages corrupt trial attorneys and for-profit medical providers to find vulnerable (and in some instances equally corrupt) workers to file fraudulent claims to collect massive payouts. You don’t need to take my word for it. Just watch this news clip.
"The high price of fake construction falls" 11/7/23
Source: abc7NY, also known as Channel 7 and WABC-TV on TV Eyewitness News ABC7NY - YouTube
After watching this investigative story you can understand why all but four (4) insurance carriers no longer write construction general liability insurance in New York or have massive carveouts to protect themselves. Insurance carriers, like casinos, are for-profit businesses. They have to make money. They do that by writing insurance premiums and working with contractors to keep workers safe and avoid any catastrophic claims. That works in 49 other states but not in New York.
The filing of fraudulent claims encouraged by unscrupulous attorneys impacts every one of us. Due to the lack of available carriers in New York, taxpayers annually pay billions more than needed for public construction. One project alone, the upcoming Hudson Gateway Project, will incur an estimated $180 to $300 million in additional costs due to the scaffold law (yes it’s a tunnel but gravity still exists). The recently rebuilt Tappen Zee bridge added more than $100 million to the final cost. You and I will pay those added costs.
In the end, fraud is a problem for everyone. However, when on-going fraud is encouraged by a decades old, defunct law we have a systematic problem. A problem that could be fixed if the New York State Legislature had the fortitude to repeal the law. They changed the laws that blocked the expansion of casinos and sports gambling and looked what happened? Tax collections have blossomed. The same would happen if we repeal the Scaffold Law. The cost of construction would decrease and we’d build more housing, more hospitals, more schools and get better roads and bridges. The “gamble” would pay off handsomely for all of us.