How to Choose a Workers’ Compensation Carrier Partner

Author, Dave Garcia, President, Rancho Mesa Insurance Services, Inc.

Many years ago, when I was a young producer, one workers’ compensation carrier legend pulled me aside and told me never to forget that a workers’ compensation decision is not a one-year decision, but at least a 4-year decision. Of course, policies are only written on a one-year basis but what he was teaching me was that the carrier you choose will handle all the claims you have through your Experience Modification cycle. So, evaluating and recommending a workers’ compensation partner for my clients just became a much more thorough analysis of many critical factors beyond just the premium.

I understand and want to acknowledge that competitive pricing is very important, yet other than price, most business owners are not sure what to look for when comparing carriers. All businesses should consider the following in their evaluation of a workers’ compensation carrier:

• What is the A.M. Best rating of the carrier?

• How long have they been in the State workers’ compensation marketplace?

• What is their premium volume within the State?

• What “in-house” services does the carrier provide? Two services for special consideration are:

  • The Claims Department

  • Loss Control Service

• How does their medical cost containment numbers compare to the industry averages?

• How does their claim closing rates compare to the industry average?

• Are the following services available?

  • Telemedicine

  • Nurse Triage

For any businesses that pay above $250,000 in annual premium, should consider these additional questions:

• Does the carrier offer a dedicated indemnity claims examiner for your business?

• Does the carrier offer Claim Review Meetings?

• Does the carrier offer a Client Services coordinator?

• Does the carrier offer on-line claim status information?

• What loss sensitive programs do they offer?

Further, for any businesses that are exploring loss sensitive programs (usually above $400,000 in annual premium) like deductible workers’ compensation, they should evaluate the following:

• What are the terms of the letter of credit required?

• Is there a Loss Conversion Factor (LCF)?

• Is a Loss Fund required?

• How are Allocated Loss Adjustment Expenses (ALAE) handled?

• Is there a policy deductible aggregate?

• Are there any claims handling charges?

• Are there Medical Cost Containment charges?

Since many of the concepts and terms above require a deeper understanding and explanation, listen to my podcast episodes where I examine this topic in greater detail.

Also, consider attending one or both of my live webinars that cover this topic and afford you the opportunity to ask questions. Register for our Thursday April 1, 2021 webinar where I will focus on businesses with annual premiums below $400,000, and/or register for my Thursday April 8, 2021, webinar where I will deal specifically with deductible workers’ compensation. Both webinars will be 30 minutes in length.

If you would prefer to speak with me directly, I can be reached at (619) 937-0170 or email me at dgarcia@ranchomesa.com. 

I wish you all a safe and profitable 2021.

Workers’ Compensation Claim Advocacy: Distinguishing Good from Great

Author, Jim Malone, Workers’ Compensation Claims Advocate, Rancho Mesa Insurance Services, Inc.

As the new normal continues evolving through this pandemic, advocates are needed across all industries and sectors. Businesses and their employees exposed to the risk of workers’ compensation injuries and illnesses need the highest level of advocacy now, more than ever. 

Like so much of what we experience in our daily interactions, establishing a baseline of competence in any field has varying levels of effectiveness. That is, there are good claim advocates and then there are great ones; high-level claim liaisons that can make organizations more knowledgeable and stronger. 

What are the characteristics that make up the great ones? And, what should you expect with their involvement in your workers’ compensation program?

The first pre-requisite for any workers’ compensation claim advocate is experience. Ideally, having multiple years working as a claim adjuster and managing a case load for an insurance company is vital. While this creates a solid base, stopping here can limit the effectiveness for employers in other critical areas. In order to begin to go from good to great you should expect your advocate to have one or more of the following experiences to offer the broadest perspective possible for your team:

• Background with return-to-work programs, in development, implementation and management.

• Experience from being a workers’ compensation administrator for a self-insured employer with the State of California and Department of Industrial Relations

• Obtaining years of training in diagnosing and treating industrial injuries from occupational medicine, orthopedic surgical, spinal surgical and pain management physicians.

• Providing years of training to workers compensation physicians on treatment and disability management of work injuries and preparing  med-legal reports and addressing permanent impairment ratings, causation, apportionment, contribution and all other issues.

• Or the very rare experience of suffering a work injury, requiring surgeries and rehab, concern for losing one career and starting over in another, and going through the entire workers compensation process through settlement

Secondly, using these technical experiences in review and oversight of claims is both tangible and measurable. That includes:

• Ensuring the accuracy of claim statuses and plan of actions.

• Recognizing when claim reserves are adequate or inflated.

• Pushing for claim closures in the most efficient and cost-effective resolutions.

• Forming a deep, consultative bond that elevates a claim advocate to that of a trusted partner.

The final component in establishing a superior workers’ compensation advocate is building strong, respectful relationships with adjusters and employers. This requires the most experienced advocate creating a “partnership environment” that allows for continual open dialogue, which very often expedites the entire claim process. The most effective of these professionals build this environment through direct communication with the adjuster(s), supervisors, and even claim department managers. That information is then thoroughly and simply shared with employers in regular intervals through formal claim reviews, safety committee meetings, and/or pre-renewal meetings involving the broker.

As a 35-year industry veteran of the claims management field, I proudly serve the Rancho Mesa team with a core commitment to providing great contributions to the claims management process. These contributions are predicated on bringing my extensive knowledge and experiences from all sides of the workers’ compensation claim process, to my advocacy role for you, my client… the employer.