Assigned Risk: Eligibility Rules

Indiana Code​, IC 27-7-2-28, requires declinations “in writing by any three (3) members of the bureau in the manner provided in this chapter.” ICRB Plan rules require that one of the declinations must be from the current, voluntary market carrier. No prior assigned risk carrier can be accepted as one of the declinations.

Indiana’s Basic Manual outlines eligibility criteria for coverage in the assigned risk market. These are found in Rule RM‐INRR‐A13F5:

2.02 Good Faith Rules of Eligibility.

Good faith is presumed in the absence of clear and convincing evidence to the contrary. An Employer is not in good faith entitled to insurance if any of the circumstances listed below exist at the time of application or after, or other evidence exists that such Employer is not in good faith entitled to insurance. The employer will remain ineligible for coverage through the Plan until the employer has complied with the policy provisions or satisfied any of the outstanding obligation(s) listed below, as applicable, and is deemed by the Plan Administrator to be in good faith entitled to insurance.

1. At the time of application, a self-insured Employer is aware of pending bankruptcy proceedings, insolvency, cessation of operations, or conditions that would probably result in occupational disease or cumulative injury claims from exposure incurred while the Employer was self-insured.
2. On a current or previous worker’s compensation policy, the Employer:
   1. While insurance is in force, knowingly refuses to meet reasonable health, safety, or loss control requirements
   2. Does not allow reasonable access to the insurer for audit or inspection under the policy
   3. Does not comply with any other policy obligations
3. The Employer has an outstanding Worker’s Compensation Insurance premium obligation or any other monetary policy obligation on a current Worker’s Compensation Insurance policy, or to a Member on a previous insurance policy that is not subject to a bona fide dispute.
4. The Employer or the Employer’s Representative knowingly fails to comply with Plan procedures; or knowingly makes a material misrepresentation on the application by omission or otherwise, including, but not limited to, the following:
   • Estimated payroll
   • Offers of Worker’s Compensation Insurance
   • Nature of business or predecessor entities
   • Name or ownership of business
   • Previous insurance history
   • An outstanding Worker’s Compensation Insurance premium obligation or other monetary policy obligation of the Employer

2.03 Declinations.

Within 60 days before the date of application, the Employer must apply for Worker’s Compensation Insurance and received voluntary market declinations from a minimum of three nonaffiliated insurers that are licensed to write and are actively writing worker’s compensation insurance within the State of Indiana. Specifically, one of the declinations must be from the insurer providing Worker’s Compensation Insurance to the Employer at the time of application, if any.

The Employer or its representative must comply with the following:

• Maintain a record of all voluntary carrier declinations for the policy period that is in force
• Provide this information on request to the Plan Administrator or Servicing Carrier to include:
  • Carrier name
  • Contact person
  • Address
  • Phone number
  • Date of contact

Reasonable Offer of Voluntary Coverage

​If the only offer of coverage in the voluntary market is at a premium higher than that available in the assigned risk plan, the employer remains eligible for assigned risk coverage. Please refer to  ICRB Circulars​ “Reasonable Offer of Voluntary Coverage” dated December 12, 12017 for more information.

Agency Change

If an insured is changing to a new agency and is currently written in, or has been offered renewal by a voluntary market carrier, then the new agency must write them in the voluntary market also.  They are ineligible for assigned risk coverage because they have been offered a policy in the voluntary market.​​  A cancellation of the voluntary market policy by the insured is not a valid reason to be accepted in the assigned risk market.  Only a cancellation by the voluntary market carrier for Indiana statutory reasons outside of the employer’s control would qualify them to enter the assigned risk market.  Those reasons are:

1. ​A change in the scale or nature of the risk​
2.  Reinsurance cancellation

Other reasons that the carrier may cancel are a result of the employer’s action or inaction and we cannot accept these cancellations by the carrier as valid reasons to enter the assigned risk market.  These include:

1. ​Unpaid Premium
2. Safety Noncompliance
3. Fraud or Misrepresentation

A Rated Carrier

An employer cannot enter the assigned risk market for the reason of obtaining coverage with an A rated carrier.  If the employer is currently insured in the voluntary market with a B rated carrier then they are considered to have valid voluntary market coverage and are ineligible for assigned risk coverage. This is regardless of a job contract requirement that they may have to be with an A rated carrier.