Who's In Charge Of Your Workers Compensation Budget

Who is in charge of your Workers Compensation budget that is 100% unregulated? Is it your agent, underwriter, premium auditor, or insurance commissioner? No, not any one of those parties, as they are all under some type of regulation.

The unregulated part of Workers' Comp premiums is (drum roll) - your Work Comp insurance adjuster. There is a long previous posting on Total Incurred. To not bore any one to tears, I left this part for today.

Your insurance adjuster needs to be licensed in most states, but there is no regulation on the reserves/total incurred they set on your WC claims. What are the guidelines for setting reserves on a WC claim? There are none. As I mentioned in the last post, whatever your total incurred is by the 180th day after your policy period expires is what you pay for your Workers Compensation premiums - plain and simple.

What do you do immediately to make sure you have no overcharges in your premiums?

1. Find your monthly or quarterly Workers Comp Loss Run from your insurance carrier and review it.
2. If you do not have one, request it ASAP.
3. Make sure that all claims that should be closed are closed.
4. If a total incurred or reserves look very large for the claim, email your adjuster.
5. Do you know who the adjuster is on every one of your claims?
6. Do you have a working relationship with that adjuster?
7. Do you have their email address?
8. If you feel you need further help, consult with a claims expert- we are claims and premium consultants. Please excuse the J&L Risk Mgmt ad.

If you answered No to #4 - #6, are you just writing checks to the agent or carrier? There is no need to just think of Workers' Compensation as a fixed cost to doing business. There are more areas to reduce your premium, but this is the one that costs your company the most!