If you’re a New York contractor, there’s a good chance your workers compensation coverage is written through the New York State Insurance Fund (NYSIF). NYSIF has been a trusted source of protection for decades, providing affordable coverage backed by the State of New York. But many contractors don’t realize that their NYSIF policy may leave them exposed when they work across state lines in places like Connecticut, New Jersey, or Pennsylvania.
If your crews are spending weeks—or even months—working outside of New York, you may not be properly covered. That can lead to denied claims, state fines, contract disputes, and in the worst cases, lawsuits or out-of-pocket liability.
This article explains what contractors need to know about working out of state with an NYSIF policy, how Endorsement #127 works, the risks of relying on it, and the steps you can take to stay compliant and protected.
The Risk: Working Out of State With a NYSIF Policy
Workers compensation is regulated on a state-by-state basis. Each state has its own laws about who must be covered, how benefits are paid, and what employers must carry.
Here’s where problems begin for New York contractors:
- NYSIF policies are designed for New York operations.
- If your employees are working full-time in another state for an extended period, that state may require you to carry a valid in-state workers comp policy.
- NYSIF’s basic policy language often won’t satisfy those requirements beyond temporary or incidental work.
Imagine this scenario: A New York contractor wins a two-month project in Connecticut. The crew reports daily to the Connecticut jobsite. If an employee is injured there, the state of Connecticut may expect coverage to be provided by a policy that complies with Connecticut’s workers comp law. But if you only have an NYSIF policy, you may be out of compliance—and at risk of penalties or uncovered claims.
Step One: Add Endorsement #127 to Your NYSIF Policy
The first tool contractors should know about is Endorsement #127, which can be added to your NYSIF policy.
This endorsement allows your coverage to extend temporarily outside of New York. It’s especially useful for contractors who occasionally take jobs in nearby states but whose business is still primarily in New York.
What Endorsement #127 Does
- Covers employees working temporarily out of state.
- Ensures a claim won’t automatically be denied just because an accident happened outside of New York.
- Helps you satisfy contract requirements when general contractors or project owners ask for proof of coverage in another state.
The Limitation Contractors Must Understand
Here’s the critical detail: Endorsement #127 applies New York workers compensation law and benefit levels, even when the injury occurs out of state.
That means your employee’s benefits are calculated under New York’s system, not the state where the injury occurred.
Why does this matter? Because some states provide more generous benefits than New York. If your employee decides to file their claim in the other state—and they are eligible to do so—you could be held responsible for paying the difference between New York’s benefits and that state’s higher benefits.
For example:
- An employee is injured while working a multi-week project in New Jersey.
- Under NYSIF with Endorsement #127, the employee would be covered under New York’s workers compensation benefit schedule.
- If New Jersey’s system offers higher payments for medical benefits, wage loss, or permanent disability, the worker may file their claim in New Jersey.
- Your company could then be on the hook for the gap in benefits not covered by your NYSIF policy.
So while Endorsement #127 is a smart first step, it’s not a complete solution for long-term or recurring out-of-state work.
NYSIF’s Program for Out-of-State Operations
Recognizing that many contractors now cross state lines regularly, NYSIF has created a program that allows policyholders to purchase out-of-state coverage while keeping their primary policy in New York.
Here’s how the program works:
- Your majority of payroll must remain in New York.
- You can request additional workers compensation policies through NYSIF to cover operations in other states like Connecticut, New Jersey, or Pennsylvania.
- This allows you to stay compliant with those states’ laws while continuing to maintain your core coverage through NYSIF.
This option is a great solution for contractors who take on repeat projects across state lines but don’t want the hassle of finding separate insurance carriers in each state. It keeps your coverage unified while ensuring compliance and claim protection.
Alternative Solutions for Contractors
While NYSIF offers strong solutions for many contractors, it’s not the only option. Depending on your business model, project size, and payroll structure, there may be better fits. At BGES Group, we specialize in helping contractors find the right workers compensation program, including:
- Private Insurance Company Plans – Some private insurers can write multi-state workers compensation policies that avoid the limitations of NYSIF’s Endorsement #127.
- Payroll/Workers Comp Plans – These programs combine payroll processing with workers compensation coverage. They make compliance simple and often provide automatic multi-state coverage.
- Professional Employer Organization (PEO) Programs – PEOs handle payroll, HR, and workers comp under one umbrella. They can seamlessly provide coverage for employees working across multiple states, making them ideal for contractors who regularly cross state borders.
Why Work With BGES Group?
At BGES Group, we are workers compensation specialists for contractors. Our team understands the complexities of NYSIF coverage, endorsement #127, and out-of-state requirements. We also know when NYSIF isn’t the best fit and when contractors should consider alternatives.
Here’s what we offer:
- Deep knowledge of NYSIF policies and how to structure them properly.
- Access to private insurance carriers that can provide broader out-of-state coverage.
- Payroll/wc and PEO programs to simplify compliance and operations.
- A focus on contractors’ unique risks and exposures.
When you work with BGES Group, you’re not just buying an insurance policy—you’re getting a partner who makes sure your workers comp is compliant, cost-effective, and tailored to your business.
Don’t Leave Out-of-State Work to Chance
Too many contractors assume their NYSIF workers compensation policy covers them everywhere. But if you’re working for weeks at a time in Connecticut, New Jersey, Pennsylvania, or beyond, you may be putting your business at risk.
- Add Endorsement #127 if you take on short-term out-of-state work, but remember it applies New York benefit laws only.
- If employees file claims in another state with richer benefits, you could be liable for the difference.
- For longer-term projects, consider NYSIF’s out-of-state program or alternative insurance solutions.
- Work with a specialist like BGES Group to avoid costly mistakes.
Contact BGES Group Today
📍 BGES Group
📞 Phone: 914-806-5853 – Gary Wallach
📧 Email: bgesgroup@gmail.com
👉 Whether you need NYSIF expertise, private workers compensation carriers, payroll/wc solutions, or full-service PEO programs, BGES Group is here to help. We specialize in protecting contractors and keeping them compliant in New York, New Jersey, Connecticut, and beyond.
Final Word
The construction business is competitive, and many New York contractors expand across state lines to grow. But don’t assume your NYSIF workers compensation policy automatically follows you.
By understanding Endorsement #127, its limitations, and NYSIF’s out-of-state program, you can protect your workers, safeguard your company, and win jobs confidently.
With BGES Group as your partner, you’ll have a workers compensation specialist on your side—helping you stay covered, compliant, and focused on building your business.