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Article By George Hohmann on Brickstreet Future Outlook

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New Brickstreet Strategies By George Hohmann

This article is by George Hohmann.

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Check back tomorrow for my opinion on how a Workers Compensation insurance carrier cannot and should not try to insure out of state workers when they are domiciled in a single state.

BrickStreet looks forward to flexibility
by George Hohmann
Daily Mail Business Editor

BrickStreet Mutual Insurance Co. hopes to offer workers’ compensation insurance for all employees of West Virginia-based companies next year, even when some of the employees work out of state, BrickStreet President and Chief Executive Officer Greg Burton said.

Now BrickStreet can only insure a company’s West Virginia employees. It is a problem when a West Virginia firm like a coal company has operations in several states.

The restriction is one of several rules that BrickStreet must follow to receive a federal tax exemption. The restriction — and the tax exemption — end on Jan. 1, 2009.

In a keynote address to the Charleston Rotary Club on Monday, Burton said BrickStreet plans to enter into a contractual relationship with a so-called “fronting company” — an insurance company that already has operations in other states — so it can insure employees of West Virginia-based companies, no matter where they work.

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Burton also said that within the next three or four years, BrickStreet wants to offer workers’ compensation insurance in other states. However, the company has no plans to offer other lines of coverage like auto or homeowners insurance, he said.

In addition, Burton said BrickStreet has no intention of “de-mutualizing” — switching from a mutual company owned by its policyholders to a stock company owned by stockholders.

The West Virginia Legislature created BrickStreet on Jan. 1, 2006, to succeed the state-owned Workers’ Compensation Commission. BrickStreet is the sole provider of workers’ comp insurance in West Virginia until July 1, when the market opens to competition.

BrickStreet must now offer workers’ comp insurance to any employer who will pay the premiums. When competition comes, “We’d love to give our competitors the bad ones and we’d love to keep the good ones,” Burton said.

BrickStreet is expecting competition from some of the biggest names in insurance, including Chubb, Erie, Travelers, Hartford and Liberty Mutual, Burton said.

BrickStreet Mutual Insurance Co. hopes to offer workers’ compensation insurance for all employees of West Virginia-based companies next year, even when some of the employees work out of state, BrickStreet President and Chief Executive Officer Greg Burton said.

Now BrickStreet can only insure a company’s West Virginia employees. It is a problem when a West Virginia firm like a coal company has operations in several states.

The restriction is one of several rules that BrickStreet must follow to receive a federal tax exemption. The restriction — and the tax exemption — end on Jan. 1, 2009.

In a keynote address to the Charleston Rotary Club on Monday, Burton said BrickStreet plans to enter into a contractual relationship with a so-called “fronting company” — an insurance company that already has operations in other states — so it can insure employees of West Virginia-based companies, no matter where they work.

Burton also said that within the next three or four years, BrickStreet wants to offer workers’ compensation insurance in other states. However, the company has no plans to offer other lines of coverage like auto or homeowners insurance, he said.

In addition, Burton said BrickStreet has no intention of “de-mutualizing” — switching from a mutual company

owned by its policyholders to a stock company owned by stockholders.

Picture of two business man shaking hand George Hohmann showing mutual company
123RF

The West Virginia Legislature created BrickStreet on Jan. 1, 2006, to succeed the state-owned Workers’ Compensation Commission. BrickStreet is the sole provider of workers’ comp insurance in West Virginia until July 1, when the market opens to competition.

BrickStreet must now offer workers’ comp insurance to any employer who will pay the premiums. When competition comes, “We’d love to give our competitors the bad ones and we’d love to keep the good ones,” Burton said.

BrickStreet is expecting competition from some of the biggest names in insurance, including Chubb, Erie, Travelers, Hartford and Liberty Mutual, Burton said.

“We want competition,” he said. “Shame on us if we’ve not been able to provide the service to keep you with us after July 1.”

Burton said BrickStreet’s customer service management – trademarked “BrickStreet 360” – means “everyone at BrickStreet who is going to touch your policy is on one team. We think this makes us unique in the marketplace.”

Liberty George Hohmann booth
Wikimedia Commons – Whoisjohngalt

He said Liberty Mutual might write workers’ comp insurance direct but other companies are expected to offer insurance through agents, like BrickStreet does.

Burton said 18,000 of BrickStreet’s 36,000 policyholders do not yet have an agent.
“If you only remember one thing from this speech, it is this: We encourage you all to get an agent,” he said. Without an agent, employers won’t be able to access all of the offerings in the marketplace, he said.
In response to questions, Burton said all carriers:

* Will start with the same loss costs and must add the same surcharges.
* Must pay the same benefits, which are set by state law.

Used with permission from George Hohmann

©J&L Risk Management Inc Copyright Notice

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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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