The official also says that while it could result in greater liability for insurers and employers, the only substantive impact of the change is to alter the cost for the ultimate payer, employers, from an assessment on their bills to a rate increase.

The case is American Economy Insurance Co. v. the State of New York. It names Benjamin Lawsky, superintendent of the state Department of Financial Services as defendant.

It was filed on behalf of American Economy and 19 other insurance subsidiaries of Liberty Mutual Insurance Co. The suit projects the cost of the change to its companies at $62 million in unfunded, retroactive liability.

Christopher Goetcheus, senior consultant, public relations, for Liberty Mutual, says, "For over a half century, the fund was financed through employer-paid assessments, which the legislation has eliminated."

He says Liberty Mutual and the industry "never anticipated that they would be responsible for these reopened claims."

Consequently, Goetcheus adds, "the state never approved, nor did they ever consider rates that included pricing for those liabilities. Liberty Mutual Insurance believes the [legislation closing the fund] warrants judicial review."

Joe DiGiovanni, senior vice president for state affairs for the American Insurance Association, says, "Insurers have never been able to price for this cost so we are not surprised that a major insurer has decided to challenge this provision of the legislation."

The closing of the reopened-cases fund was among a number of changes Gov. Andrew Cuomo proposed in a general overhaul of the State Insurance Fund.

The governor estimated closing the fund would save employers $300 million annually.

The lawsuit was filed in state Supreme Court for New York County on behalf of Liberty by lawyer for Greenberg Traurig.