Assigned Risk Pool – Getting Out Of It Is Possible
The Assigned Risk Pool makes an alternate decision very difficult. The easiest method to remove your company from the Voluntary Risk Market and place your Workers Comp coverage in the general marketplace is to reduce your Experience Modification Factor.
Your company may likely have a very high E-Mod compared to similar businesses. We have posted many previous articles on how to reduce your E-Mod.
Another way to possibly remove your company from the Assigned Risk Pool is to make sure that your agent has shopped your business in all available markets. We have seen this method remove companies from an Assigned Risk Pool if there are workers comp insurance companies that specialize in, or better understand, the risks involved with your company. Never just assume that you should be in the Risk Pool.
Make sure that your company has the correct Classification Codes assigned to it. Quite often, certain Workers Comp Classification Codes have a high risk associated with them and no insurance company will write the coverage in the voluntary market.
Update – Looking at the alternative insurance markets have become very viable over the last few years. Agents/brokers usually cannot search the alternative markets.
One mistake we have seen companies make is to think in the short term with cost reductions. Having a safer company will show up in your Workers Comp insurance in the second year of safe operations and will not be fully realized until the fifth year. We have seen companies switch their focus away from Workers Comp savings strategies, as there seemed to be no effect on their premiums.
There are a few companies that cannot be written in the voluntary marketplace due to the risky nature of the job functions.
Next Up – The Dangers of a Short-Rate Policy