All of West Virginia employers, other than governmental entities, can for the first time, shop their workers’ compensation coverage among carriers in a competitive market.
Insurance Commissioner Jane L. Cline said all indications are that the privatization of the workers’ compensation market has been very successful. Employers are, in total, paying over 30 percent less than they did under the state monopolistic system and will now be able to choose their carrier based on their needs, Cline added.
To date, 162 private carriers filed with the West Virginia Offices of the Insurance commissioner which will enable them to offer their product to West Virginia employers. Of those 162 companies, 24 companies are new to the West Virginia insurance market.
Several aspects of West Virginia’s system were changed to reflect the systems found in most other non-monopolistic states, Cline said.
West Virginia installed the National Council on Compensation Insurance’s job classification system, which consists of over 550 classifications and is found in 37 other states.
This enables businesses in our state to properly report the job functions of their employees and carriers to accurately assess the rate needs, Cline said.
The commissioner named NCCI as West Virginia’s statistical agent to determine appropriate loss cost rates for all classifications and develop applicable experience modifications for qualifying employers. Claims handling practices, policy issuance and billing procedures have been amended, among other processes, she said.
Recent legislation will allow West Virginia to establish a residual market using NCCI as the plan administrator, with reinsurance provided by the national pool. Again, this reflects systems commonly found in other states. Efforts to have the residual market ready by January 1, 2009, are currently underway and on schedule, according to Cline.
Source: West Virginia Office of Insurance
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