Insured
An independent grocery store that employees 500 people with annual revenues of
$20 million.
Situation
The employer had a large open claim reserve of $140,000 as a result of a back
injury to an employee. There was also a possibility of litigation as a result
of the injury.
Assessment
Certified WorkComp Advisors (CWCA) explained to the client that open claim reserves
increase the Experience Mod in the same way as claims actually paid. As a result,
the Mod was in danger of increasing from .94 to 1.06. To prevent this, steps
needed to be taken to reduce the open claim reserve before the critical valuation
date.
Solution
The CWCAs used information taught at the Institute of WorkComp Professionals
on how to work effectively with claims adjusters. They worked with the company's
Safety Director to develop a comprehensive plan that would lower the outstanding
reserve. The plan convinced the claims adjuster that the employer would implement
the proper procedures needed to control costs.
Result
As a result of the plan, which included eliminating litigation, the claims adjuster
reduced the reserve by $100,000 before the critical deadline. Thus, the Experience
Mod remained at .94. Over three years, this represented a premium savings of
$60,408.
