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Assigned
Risk
When
employers can’t find workers compensation insurance in
the regular market, they have available a market of last resort,
also known as assigned risk market, residual market, or the
pool. Once an employer gets three rejections from insurance
companies, it can apply for coverage in the market of last
resort. Assuming the employer meets all other qualifications,
the ICRB binds coverage for the employer.
Our goal is to process assigned risk applications within 5
work days. In 2006, the ICRB achieved a 3.66 work day average,
which matches our best result ever! New applications and written
premium decreased for the fourth year in a row. New applications
for 2006 totaled 2,915, which represents a 60% decrease since
the record high year in 2002. New risk premium was down from
$33 million to $11.5 million for the same period.
| Year
% Change |
| 2000 |
17%
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| 2001 |
21%
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| 2002 |
63%
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| 2003 |
-14%
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| 2004 |
-12%
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| 2005 |
-7%
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| 2006 |
-17%
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To
complete the application process, we assign the employer to
a Servicing Carrier. A Servicing Carrier is a member of the
ICRB which has agreed to act as the insurance provider for
employers participating in the Plan. The decision of an employer
to participate in the Plan is completely voluntary. Likewise,
an employer may leave the Plan and procure voluntary market
insurance at any time.
Once an employer is assigned to a Servicing Carrier, the Servicing
Carrier provides all of the normal services of a regular market
workers compensation insurance carrier including underwriting,
premium collection, auditing, loss prevention, and claims
management. The employer and the Servicing Carrier interact
in the same fashion as though the insurance had been procured
in the regular market.
Indiana law requires the ICRB and Workers Compensation Board
of Indiana (Board) to approve cancellation of assigned risk
policies (IC 22-7-2-31 and IC 27-7-2-37). Our standard procedure
is that past due premium or a non-compliance matter must be
outstanding for at least thirty days. The Servicing Carrier
must issue an original notice with at least two follow-up
notices during that time. The servicing carrier can submit
this documentation to the ICRB requesting cancellation. Upon
ICRB and Board approval (usually within 3 weeks), the carrier
can then issue its cancellation notice. We approved almost
1,900 cancellation requests from Servicing Carriers in 2006.
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