State RegulationsNY specificDifficulty 2/5
Under Reg 62's coordination of benefits provision, when a plan pays as the secondary plan, how is its payment determined?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
Under Reg 62 (11 NYCRR Part 52), the secondary plan calculates what it would have paid had it been primary, subtracts the primary plan's payment, and pays the remaining balance of covered expenses up to that amount. The result is that the insured is made whole for actual covered expenses but never recovers more than the loss. This non-duplication formula is the arithmetic heart of the coordination of benefits provision in New York group plans.
Why the other options are wrong
- A) A secondary plan is not zeroed out by any primary payment; it still pays the uncovered balance up to its normal benefit.
- B) Paying the full benefit on top of the primary payment would produce double recovery, which coordination exists to prevent.
- C) The secondary plan neither refunds the primary payment nor takes over the claim; it simply supplements the primary payment up to its limits.
Memory hook
Secondary = fill the gap, not double the money.