The Mandolodis Decision Part II
The Mandolodis decision was discussed heavily at the West Virginia Workers Comp Conference. On 04/08/08 I attended the West Virginia Workers Comp Conference. The Conference is a prelude to the open market for Workers Comp in WV as of 7/1/08.
The Mandolodis decision discussion became very contentious. The one area that concerned me, as it did most of the insurers, was the Mandolodis decision. Please see my last post for a breakdown of what the suit entails for Workers Comp insurers.
While the NCCI said that Mandolodis would not affect any employers’ E-Mod, there was a great concern that there would be coverage under Part B of a Workers Comp policy. Part B of a Workers Compensation policy is known as Employers Liability. It was designed as a catch-all in case a suit was brought against an employer that would be considered a liability claim.
Most state statutes and Supreme Court cases have ruled that there is a sole remedy for Workers Comp and that employees could not choose to sue their employer under a liability claim. Such suits would wreck the Workers Comp system.
Mandolodis seems to have punctured the employer’s veil of Workers Comp as a sole remedy. That leaves the insurers and employers of WV in an interesting situation. One of the solutions that I had heard at the conference was to have a stop-gap policy that addressed the Mandolodis claims. This would seem to work on the surface, but Mandolodis claims involve an INTENTIONAL act by the employer. Insurance never has and never will cover an intentional act. This may complicate the situation even further.
The NCCI (National Council on Compensation Insurance) is the final decision maker on whether those claims affect the E-Mod. They gave their assurance that it would not affect an employer’s Workers Comp E-Mod. My understanding is that Brickstreet (the state-mandated temporary monopolistic Workers Comp carrier) is offering a Mandolodis coverage for a certain % on top of the original policy.
I am sure there is going to be some effect from the Mandolodis decision in WV. We may have to wait until 2010 to see what the final effect was from this conundrum.
Next Up – More on the West Virginia Conference
©J&L Risk Management Inc Copyright Notice