Workers Comp Reserve Reviews Loss Run Best Reduction Strategy

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Workers Comp Reserve Reviews Start With Current Loss Run

The start to effective Workers Comp reserve reviews begins with a current loss run – hopefully online.  This is the area that seems to be the most misunderstood.

Graph ClipArt of Black Arrow Increase Reserve Reviews Loss Run In Bar Graph
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We often have employers contact us about a loss run they had just received or about how their E-Mod increased so rapidly in one year. The fastest and most effective method starts with a loss run review.

We often recommend that the employer obtain a copy of their loss run. Your insurance carriers will provide a copy on request. The Work Comp carriers will usually provide a loss run quarterly.

Please remember that only the OPEN claims can be dealt with, as a closed claim or the previous reserves on a closed claim usually cannot be questioned later on. That is why it is so critical to track the claims as they develop. Discussing a reserve that was opened on a claim three years ago will not do any good. In other words, when a loss run is received, it should be reviewed on receipt.

J&L currently has many clients that ask us to review their claim reserve levels including riks managers and agencies.   Some of the info we look for in listed below.

Medical Personnel Pouring Medicine Reserve Reviews On Hand
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Things to look for in a Workers Comp loss run are:

  • Old claims still open
  • Resolved claims still open
  • A small amount of indemnity total incurred with a large amount of medical total incurred, or vice-versa.
  • A large increase in reserves or total incurred on a claim
  • A re-opening of a closed claim
  • The total incurred does not match the claim, such as a large amount of reserves on a minor injury
  • The injury listed does not match the employee’s injury
  • An injured employee’s name that you do not recognize
  • Anything that just looks out of place.
  • Many others

A reason or reasons may exist for the above bullet points.   Remember the equation Total Incurred = Paid + Reserves in your Workers Compensation reserve reviews.

UP NEXT– Contacting your adjuster if you find something questionable.

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James Moore

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Mgmt Consultants, Inc. in 1996. J&L’s mission is to reduce our clients’ Workers Compensation premiums by using time-tested techniques. J&L’s claims, premium, reserve and Experience Mod reviews have saved employers over $9.8 million in earned premiums over the last three years. J&L has saved numerous companies from bankruptcy proceedings as a result of insurance overpayments.

James has over 27 years of experience in insurance claims, audit, and underwriting, specializing in Workers’ Compensation. He has supervised, and managed the administration of Workers’ Compensation claims, and underwriting in over 45 states. His professional experience includes being the Director of Risk Management for the North Carolina School Boards Association. He created a very successful Workers’ Compensation Injury Rehabilitation Unit for school personnel.

James’s educational background, which centered on computer technology, culminated in earning a Masters of Business Administration (MBA); an Associate in Claims designation (AIC); and an Associate in Risk Management designation (ARM). He is a Chartered Financial Consultant (ChFC) and a licensed financial advisor. The NC Department of Insurance has certified him as an insurance instructor. He also possesses a Bachelors’ Degree in Actuarial Science.

LexisNexis has twice recognized his blog as one of the Top 25 Blogs on Workers’ Compensation. J&L has been listed in AM Best’s Preferred Providers Directory for Insurance Experts – Workers Compensation for over eight years. He recently won the prestigious Baucom Shine Lifetime Achievement Award for his volunteer contributions to the area of risk management and safety. James was recently named as an instructor for the prestigious Insurance Academy.

James is on the Board of Directors and Treasurer of the North Carolina Mid-State Safety Council. He has published two manuals on Workers’ Compensation and three different claims processing manuals. He has also written and has been quoted in numerous articles on reducing Workers’ Compensation costs for public and private employers. James publishes a weekly newsletter with 7,000 readers.

He currently possess press credentials and am invited to various national Workers Compensation conferences as a reporter.

James’s articles or interviews on Workers’ Compensation have appeared in the following publications or websites:

  • Risk and Insurance Management Society (RIMS)
  • Entrepreneur Magazine
  • Bloomberg Business News
  • WorkCompCentral.com
  • Claims Magazine
  • Risk & Insurance Magazine
  • Insurance Journal
  • Workers Compensation.com
  • LinkedIn, Twitter, Facebook and other social media sites
  • Various trade publications

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