Term Of The Day – Informal Retention
Informal Retention is a Workers Comp policy of sorts. This type of retention is usually considered illegal except under exactly prescribed circumstances.
This type of Risk Financing Plan requires little planning. Since there are no records kept, cost is reduced. As the losses happen, they are paid directly out of the organizations current assets or cash flow. These payments are treated as a normal business expense.
Most states require non-self insured companies to have a policy in place to cover injured workers.
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