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West Virginia Workers Comp – Was It Ever Subsidized?


West Virginia Workers Comp Was Subsidized

Was West Virginia Workers Comp Carrier Brickstreet subsidized by taxpayers?  I was reading a Opinion Letter in the Charleston Daily Mail about Workers Comp being subsidized for governmental entities in WV. I had to disagree with the letter as the author inferred that WV governmental entities were being subsidized as Brickstreet had been writing them at a loss since 2006.

Wall West Virginia Workers Comp bricks
Wikimedia Commons – Pawel Wozniak

Insurance carriers will quite often write a section of a market and not just cherry-pick the safest employers with the classification codes in that marketplace. Brickstreet’s whole book of business allowed for a large profit as they were able to pay their very low interest loan back to the state government much earlier than anticipated.

Do the safer governmental entities or businesses ever actually subsidize the less safe ones? I would say no as that is the function of the Experience Modification System. The E-Mod system penalizes the unsafe insureds. The E-Mod system allows a discount of sorts to the safer insureds. One of the benefits of WV switching from their State Fund system to the NCCI system was a more accurate E-Mod system.

State West Virginia Workers Comp logo

Brickstreet had said in a press release that the rates for some of the governmental entities were being artificially suppressed causing a loss of $25 million for writing governmental entities. However, as we have seen very often in the marketplace, carries such as AIG and Travelers are writing the same business that Brickstreet wrote in the past priced at Brickstreet’s previous policy year without increases.

It will be interesting to see what policies have been written by which carriers and at what price for governmental entities. I think that you will see incredibly low pricing by the big carriers where there will be no subsidizing in the general marketplace.

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James J Moore - Workers Comp Expert

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Management 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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