Work Comp Subrogation Additional Concern
Work Comp subrogation has a kind of quirky standard definition.
To me, it is the possibility of another party having to share the monetary responsibility of an insured incident or accident.
I give the example in my manual of a company salesperson on sales calls being hit by another car in the back bumper and sustaining Workers Compensation injuries.
The driver of the other car should pay for the damages sustained and reimburse the Workers Comp carrier.
We usually see two errors being made during our file reviews:
- We often see the subrogation funds being added back into the file after the file has been closed. However, the amounts reported to NCCI may not change. The funds could greatly affect a company’s Workers Compensation E-Mod.
- The Workers Comp adjuster may not have enough time to pursue subrogation or may take a small % of the liability settlement.
Both instances are E-Mod killers. As I pointed out in my manual, there are 13 basic functions of a claims adjuster. This area is one of the lower-priority tasks.
In the 1980s, adjusters became much more specialized. I was lucky enough to have experience as an all-lines claims adjuster.
Workers’ Comp adjusting evolved to become a very specialized type of adjusting in the 1990s. Each state has its own set of laws and regulations on handling WC claims. Some similarities exist between the states.
Insurance carriers and TPAs rarely have an auto or premises liability adjuster cover workers’ compensation claims. Over time, their employer rarely trained a workers’ comp adjuster in liability adjusting.
The ability was seen as unneeded and a time-waster. Bottom line – workers’ comp adjusters need more training in subrogation liability. Without it, large amounts of money will be left on the table that could be refunded back to an employer’s file and eventually their E-Mod or LDF.
The employer will likely have to monitor the subrogation follow-up in most situations. There are many articles on how to track work comp subrogation in this blog.
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