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Exclusive Remedy Doctrine in Workers Compensation

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Term Of The Day – Exclusive Remedy Doctrine

The Exclusive Remedy Doctrine makes Workers Compensation claims a no-fault process.

The Workers Compensation insurance provided by an employer will cover the employee no matter who is at fault or even if the incident was purely an accidental occurrence.   An injured employee’s benefits may be decreased if they did not used a supplied safety device.   The reductions are extremely rare. 

Graphic Of Law Book Exclusive Remedy Doctrine With Magnifying Glass
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The no-fault keeps the employer from denying the claim if it was the employee’s fault. The employer benefits as the employee cannot sue the employer if they were negligent for some reason.

Employees and their attorneys have tried to pierce this veil of no-fault insurance coverage and sue the employer as if the accident was covered by liability insurance. The courts have stuck to the spirit of the doctrine for the most part.

An insurance carrier cannot write business in a state where lawsuits are allowed that circumvent the Workers Comp insurance structure. The insurance carrier does not collect premium as if liability suits would be allowed against their insureds. There have been a few incidences where a liability suit can be brought against an insured even if the accident was covered by Workers Compensation.

The reaction of many carriers is to immediately cease writing coverage in that state or to increase premiums dramatically.

Recently, the West Virginia Supreme Court has allowed such a lawsuit. I am not sure if this would counteract all of the good work that Governor Manchin and the WV Department of Insurance have done to provide a free and open market for Workers Comp insurance.

2019 Update – The courts have allowed a few challenges to Exclusive Remedy.  The doctrine stood the test of time and now keeps the jurisdiction of an industrial accident in the workers’ compensation courts.

2021 update – with the new rush of COVID-10 claims, the Exclusive Remedy doctrine of workers comp will likely be challenged numerous times in the future.

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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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