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 can’t find coverage from three 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 2012, the ICRB achieved a 1.93 work day average, our best result ever.. New applications for 2012 totaled just over 2,400, a 46% increase from last year. New risk premium increased (97%), totaling $23 million. Total assigned risk 2012 calendar year direct premium written was $49 million which represents 6.2% of total WC premium in Indiana.
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.
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 2 weeks), the carrier can then issue its cancellation notice. We approved just over 2,000 cancellation requests from Servicing Carriers in 2010, a 13% decrease.
Employer May Leave Assigned Risk Market
The decision of an employer to participate in the Plan is completely voluntary. An employer may leave the Plan and buy voluntary market insurance at any time.