More good news for New York Workers Compensation

I found a piece of  news from Standard & Poor’s as it relates to the state of the worker compensation market place. It’s not comforting to know that because of the poor economy, adverse reserve developments, poor investment return, increasing expenses, rates could ultimately go up in New York Workers Compensation

 Is this good news? Not exactly; as an agent of a firm established in 1932 I cringe when I see this type of article. This is mostly because private workers compensation carriers are beholding their stockholders, and the New York state insurance fund directs fate in their favor. As external and internal forces change there is no solution except increasing premiums.

 Pay-up and shut up. There is nothing you can do, or is there?

 I say if you are a company that has implemented a safe work place reflected in your loss history and modification factor, any rate increase is unacceptable. You can reverse this trend and actually see rate decreases.

 In order to do this you have to change the way you think about “funding” your workers compensation policy. The premium dollar turns into a “cost sharing” dollar and changes only if there are losses. The obvious component is to have a good claims history, or what insurance companies call “good experience”. With this history you can work with a company that will  guarantee that your total cost would never be more then what you would have paid in a standard market should there be claims, while allowing you the upside savings, (can be in excess of 50%) should you have no claims.

 This product exists and is easily obtainable for insured’s that are willing to look at their New York Workers Compensation as a “cost sharing” product versus a net premium payment.