Over-reserving on WC Claims
WC claims Over-reserving analyses are difficult. I usually try to post every two days. I have not posted for four days as this area was too complicated to fit into one post.
The bottom line is that it is very difficult if not impossible to identify reserves that are too high without at least 5 – 7 years of Workers Comp adjusting experience.
As I have said numerous times in presentations and in this blog, online claims access is the key to controlling the reserving on your files. If you are not up-to-date on your claims, questioning the reserves on any claim may end up with an unanticipated reserve increase.
Calling attention to the wrong claims may harm your claim reserve levels. Do not inquire about reserves on a set of claims without having some updated reason that would result in a claims reserve reduction. A positive medical status update may be a good reason for a reserve reduction inquiry to the adjuster.
I have 24+ years of experience in claims adjusting, underwriting, and statistical analyses, particularly in Workers Compensation. I find it difficult myself to just look at a loss run and decide whether or not the reserving is not in line with acceptable standards.
If I just have a loss run, I or someone on our staff has to email the adjuster for a status. If you have the availability of customizing your loss runs, ask for the status field to be added. At least then you will know where the claims stand that are affecting your E-Mod or Loss Development Factor if you are self-insured.
I tried to cover Workers Comp reserving over the last two weeks in detail. I hope it was helpful. If you have any questions, please drop us an email.
©J&L Risk Management Inc Copyright Notice
