NY Insurance Hike: Short Window for Long-Term Solution

by T. D. Thornton

Now that a worker’s compensation insurance plan for jockeys and exercise riders is in place to ensure racing and training at Aqueduct and Belmont Park will continue seamlessly into 2015, New York Jockey Injury Compensation Fund president Rick Violette Jr. said the next step will be for the organization to seek a more cost-effective provider so horsemen won’t have to face a steep 59% increase in premiums. 

The NYJICF has a three-month window to terminate without penalty its 2015 agreement with the New York State Insurance Fund. While attempting to partner with a new carrier, Violette said the organization will prepare owners and trainers for up to $6.7 million in worst-case costs while simultaneously attempting to come up with ways to defray the rising price of insurance. 

“We have to operate as if we’re going to carry the full boat until we have more meat on the bones,” Violette said. “It’s a little bit like we do in racing, period: We have to prepare for the worst and hope for the best, and then make adjustments as we go forward.” 

Violette said even though the no-penalty date for cancelling the existing NYSIF insurance policy is Mar. 31, any new plan would have to be presented to the New York State Gaming Commission ahead of that date so the board can approve the change. 

“We’d have to inform the gaming commission by the 15th of March, and things would pretty much have to be in ink before then,” Violette said. “If we find an entity other than NYSIF to carry on from April 1, we walk away from NYSIF free and clear. If we do not walk away, we are stuck with the entire bill.” 

Violette said having an extension in place to start 2015 opens up negotiating options. 

“There are some significant live wires out there. We’re not just shooting in the dark,” Violette said. “There are four different underwriters that have shown significant interest. Because we had this week as a deadline, they didn’t jump in with both feet. But now that we have this open window they have jumped back in. Hopefully that will give us some great results.” 

Violette would not estimate how much of a price break NYJICF might get by switching carriers. 

“Until the insurance companies put it on the table, I’m not even going to speculate,” Violette said. “[Any amount] less than the state fund is a great place to start. We could be at the altar with three different entities. [The insurance process] is complicated on its best day, and [the opt-out clause] has made it even more complicated.” 

Violette said he is looking at ways the New York Thoroughbred Horsemen’s Association could help to arrange funding for a one-time reduction to the initial 2015 insurance payment for trainers only. But he stressed that plans to provide financial assistance are not a done deal and are still considered a complex work in progress. 

“We’re hell-bent to get it done, and we’re working on it as we speak,” Violette said. “It would be for the trainers who have committed to racing in New York by having stalls now that are filled. They’re kind of the infantry here. They have committed to racing in New York this winter and are kind of getting blindsided by this significant increase in premiums. We’re trying to reduce that blow as much as we can.” 

Costs could be further offset by increases in both the current amounts horsemen pay toward workers’ compensation through a per-stall daily fee (95 cents to $1.50) and a surcharge on purses (from .95% to 1 %). 

“That .05 percent in purses in the stream of things is not a lot of money, “Violette said. “I’m very protective of purse money. That starts to be a slippery slope as you start to raid that account.” 

Violette underscored that attempts to reduce insurance costs will also require a “comprehensive re-evaluation” of workplace safety at New York tracks in both mornings and afternoons. 

“Everybody understands that the best way to reduce the cost of insurance is to reduce the number and severity of injuries,” Violette said. He detailed how everything from strengthening protocols for when horses get loose to improving lighting in pre-dawn hours to sifting through historical data to find common denominators in accidents are fair game for improvement. 

“I’m even advocating for random breathalyzer testing for exercise riders,” Violette said. “The jockeys have to do it every time in the afternoon, and it’s time to step up responsibility in the mornings as well.”