Wausau Glass Company
Discovers Value of CWCA
Insured
Located in Wausau, WI, Rib Mountain Glass specializes in glass for commercial
entrances and storefronts, construction glazing and retail glass sales.
With 40 employees, the company had sales revenue in 2005 of approximately
$2.5 million.
Situation
Rib Mountain Glass began working with a CWCA in 1995. Then, in 2002, the
company moved its account to a direct insurance carrier at a time when rates
were increasing and lower pricing seemed to be the issue for the owners.
The direct writer promised the coverage would be the same as that which
was provided by the CWCA. It wasn’t. The direct writer also agreed
to provide Rib Mountain Glass with a safety manual. What they received was
a “generic template” from a web site that was not specific to
the glass business. To use the manual, Rib Mountain had to revise it for
its purposes. In addition, although the goal of moving to the direct writer
was to save money, Rib Mountain was actually paying $30,000 more than it
did in 2002, largely due to an increase in the Experience Modification Factor
(Mod) f rom 0.66 to 1.17.
Assessment
The Rib Mountain experience illustrates several important issues:
• Insurance policies that appear to be identical can be quite different.
It is often difficult for insured’s, who are not familiar with coverage
issues, to identify the differences.
• The value of a Certified WorkComp Advisor. A Certified WorkComp
Advisor reviewed Rib Mountain’s coverage and found the direct writer’s
handling of claims had not been good. Some claims that should have been
cleared in a year were still open two years later. Rib Mountain’s
Experience Modification Factor (Mod), which had been 0.66 in 2002 left nearly
doubled from 2002 to 2004, reaching 1.17 in 2004.
Solution
Rib Mountain’s management requested a meeting in 90 days to move the
account back to the CWCA’s agency. This occurred on the anniversary
of the policy. The CWCA gave immediate attention to the outstanding claims
and works with Rib Mountain, the insurance company adjuster and treating
medical providers to reduce the outstanding claims. There are many reasons
that claim costs escalate unnecessarily. Often employers do not know what
to do when an injury occurs and lack a clear and definitive process to manage
the injury. In addition, insurance company’s claim management is challenged
by increased caseloads and reduced staffs. Medical care is often misdirected
and uncoordinated. CWCA’s are trained to Help employers closely monitor
the progress of injured employees so that costs do not spin out of control.
Result
The CWCA has been able to stem the tide of Rib Mountain’s rising Mod.
For 2006, the client’s Mod will be 1.11 and should continue to drop
as the improperly handled claims are cleared. Says a representative of Rib
Mountain Glass, “With the help of our CWCA, we are understanding WorkComp
better and using their guidance we’re learning how to get our rates
and costs under control.” |