Workers Compensation Part 1 Flashcards
(35 cards)
1
Q
WC Statute
A
- Obligates ER to pay specified medical disability, rehab and death benefits
- Job Related
- Regardless of Fault
2
Q
Benefit Requirements
A
- Must arise out of and in the course of employment
- Occupational Disease covered
- Cause and Effect relationship
3
Q
Benefits Provided
A
- Medical
- Full and unlimited medical expenses benefits of covered injury or disease
- First Dollar Coverage: no deductible or co-insurance
4
Q
Disability
A
Work will eventually resume all duties
1) Temporary Partial Disability:
2) Temporary Total Disability
3) Permanent Partial Disability
4) Permanent Total Disability
5
Q
Temporary Partial Disability
A
prevents injured worker from performing some job duties for a definite period of time
6
Q
Temporary Total Disability
A
unable to perform any job duties fora specific period of time
7
Q
Permanent Partial Disability
A
Suffers an irreversible injury but can return to some work duty; lose an eye
8
Q
Permanent Total Disability
A
They will never be able to perform job duties again
9
Q
Disability Benefits
A
- Loss of wages during injury period
- Deductible: Waiting period
- Paid Weekly
- % of salary; varies by state
- compensation also for losing specific body parts
- Does not hinge on wage loss
10
Q
Rehabilitation Benefits
A
- Goal to return to work
- Pay expenses for physical therapy
- Can cut the cost of claims
- Cuts costs/saves money
11
Q
Death Benefit
A
- Burial expense
- Partial Replacement of worker’s former weekly wage
- Varies based on the number and types of dependents
12
Q
Out of State Law Application
A
- When traveling in another state
- File in the state injury occurred
- File in state where employer/job is located
- ## File in the state where the EE resides
13
Q
What drives the decision on state to file?
A
State the pays the most
14
Q
Methods to meet WC Obligation
A
1) Private Insurance
2) Assigned Risk Plans
3) State Funds
4) Self Insurance
15
Q
Private Insurance
A
- Pay premium: insurer pays and administers claims
- Highly experienced based
16
Q
Assigned Risk Plans
A
- Can’t acquire private insurance
- Unable to meet insurer underwriting requirements
- Poor experience
- Varies by state
- Usually a pool of business accepted by private carriers funneled via the state
- Common with auto is both mandatory
17
Q
State Funds
A
- Half of states have set up funds
- Controlled by state but function like private insurer
- Accept any good faith application by a state company
- Some states compete with private carriers
- Some states is only option
18
Q
Competitive State Funds
A
- Some states’ funds compete with private carriers
- ER can buy from state or private carrier
19
Q
Monopolistic State Funds
A
- Some states it is only option
- Unable to purchase rom private carrier
- North Dakota, Ohio, Washington, West Virginia, Wyoming, and Puerto Rico
20
Q
Self Insurance
A
- Long tail (Non Volatile) appealing with time value of money
- Allowed by state if financial capacity is demonstrated
- Sometimes must post bond with state
- Must also demonstrate an ability to properly administer a plan
- Appropriate for ERs large and with good experience
21
Q
Self Insurance Challenges
A
- ER often purchases excess coverage to cover a catastrophic loss when self insuring
- Aggregate Excess: covers total losses past retention point to a stated limit and not tied to a specific location; only claims in total
- Specific Excess: Retention Amount to a maximum
- On per claim basis
22
Q
Policy - WC
A
- WC + EL Policy
- WC and ER Liability
- Policy Form is filed and maintained most states
- Not ISO
- National Council on Compensation Insurance (NCCI)
23
Q
Policy: Part 1
A
- WC
- Pays for obligations required by law
- Insurer also defends in a lawsuit
- Also pays for a penalty to ER
24
Q
ER Penalty List
A
1) Willful Misconduct
2) Illegal Employment
3) Failure to comply with health and safety laws
4) Discrimination against any EE who files a WC claim
25
Policy: Part 2
- ER Liability
- Pays for EE injury, not WC
- 3rd party lawsuit
- Family member lawsuit (loss of consortium); spouse injury asbestos
26
Policy: Part 2 Exclusions
- Injury outside US or Canada
- Punitive damages due to illegal EE
- Intentional bodily injury on part of Insured
27
Policy: Part 3
- Other state's insurance
- Extends WC and EL automatically to any state listed in section 3
- Section 3A lists states currently operating
- 3C are states you might operate
- Must inform insurer when 3C star becomes active
- If you enter state that is not on 3A or 3C - must notify insurer within 30 days
- Why not just say all states; might not be licensed, some monopolistic, insurer must avoid states not licensed or monopolistic states
28
Why not just say all states in WC policy?
- might not be licensed,
- some monopolistic,
- insurer must avoid states not licensed or monopolistic states
29
Stop Gap Coverage
- Insured has operations in monopolistic state
- State policies do not include Er's liability
- Can be part of your WC policy that applies to there states
- Could also be part of your CGL
30
Rating WC
- MCCI files forms and endorsements for insurer in many sates
- Some states have their own rating bureaus
- Set tables used to create manual or "book rates"
- Premium uses payroll as its basis
31
Worker Classification
- Identify group of EEs to set rate on appropriate risk
- Governing classification is what best describes overall operation
- Not all EEs fit into this description/Classification
- Except in some situations; governing classification is what prevails in setting manual rates
32
WC Premium: Experience Rating
- Premium for particular insured is increased or decreed in future periods
- Tied to the experience of the inured
- Also tied to credibility of results; time and size
33
WC Premium: Retrospective
- Premium for an insured is increased or decreased in current premiums
- Pay a minimum premium
- Depending on results during policy period; refund or bill for additional premium
34
WC Premium: Large Deductible Plan
- Essentially self funding with catastrophic coverage
- Allows insured to self insure without going through the state requirements to set up self insurance program
- Not high deductible plan!
- Range from $50,000 to $250,000 per claim
35
Retrospective Good For?
- Insurer who is concerned about a marginal account
| - Insured that is confident that claims will be low
