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Are Competitive State Funds The Same As Regular Carriers?


Competitive State Funds Still Exist Across The US – Updated 2019

Facilities that are state-owned and operated that directly compete with commercial carriers. The competitive state funds usually only write Workers’ Comp policies that are intrastate (inside their own borders). Not all states participate in this type of fund.

Chart of Competitive State Funds of the business environment vector
Wikimedia Commons – PaulaD.MezaD

The states with this type of fund are  Arizona, California, Hawaii, Idaho, Kentucky, Louisiana, Maine, Missouri, Maryland, Minnesota, Montana, New Mexico, New York, Oklahoma, Oregon, Pennsylvania, Rhode Island, Texas, and Utah.

West Virginia had used Brickstreet as a competitive state fund until recently.  SCIF (California) is the largest of the competitive state funds.  SCIF consistently ranks as one of the largest worker’s comp carriers in the US.

The last ranking provided by Best’s Insurance rating has them ranked at 6th.  The rankings compare SCIF to all premiums written nationally.  SCIF’s size ranks with Travelers, Hartford, and the other major players even though they provide insurance for just one state.

Update – CompSource Oklahoma changed to a commercial carrier in 2016.

Many people mistake ARAP or Assigned Risk Programs with competitive state funds.   In most instances, they function as totally separate programs.

I mistakenly identified Montana as a monopolistic state. Montana has a competitive state fund.   Due to market forces many of these states will likely privatize them such as in the case of Oklahoma’s Compsource and  West Virginia’s Brickstreet.   Brickstreet and Compsource have experienced a measure of success after privatizing their operations.

The markets now consider Brickstreet as a carrier that provides voluntary marketplace policies in many states.  Brickstreet moved into the North Carolina market very rapidly over the last few years with a few marketing blitzes.

Some prognosticators identify these funds as having an unfair advantage due to the state or taxpayer dollars backing these funds regardless of operating losses.

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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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