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Rating Bureaus – Claims Reporting Confusion Question


Rating Bureaus  – How Do They Receive Claims Info – Reader’s Question

A readers question on how claims are reported to the Rating Bureaus.  Loss runs are the Holy Grail for controlling your Workers Comp costs.  A great blog readers question email came in last week.   The question – paraphrased was –

Vector Graphic Of Woman Rating Bureaus With Question Mark

We have our loss run, but the numbers on our Rate Bureau report do not match the numbers from last year.  Is there a secret formula to figuring all of this out?  How do we match the numbers?  

The first area to cover is the loss runs.  When were they dated?  What is the valuation date for the loss runs?   The end of your policy year loss run will seldom match your Rate Bureau report.

The loss run should be dated as close to six months after policy expiration as possible.  There are many articles in this blog on loss run report timing.  Use the search box and search for loss run.  Many articles will show on the search results.

Claims adjusters change the reserves on the files very often.   Most claims departments ask their adjusters to at a minimum review the reserves at 60, 180, and 360 days after the claim is initially opened.   Tracking loss reserves is one of the reasons I am an advocate for full online claims access by employers.  Ask your TPA, carrier, or agent to see if online claims access is possible with your current carrier.  It is worth the extra expense.

Picture Stress Woman Rating Bureaus Looking On Paper

The main amount to search for on the loss runs is the Total Incurred.   The total incurred figure is what is reported to the Rate Bureau six months after policy expiration.   Total incurred = Paid + Reserves .  Some carriers and TPA’s have added to the confusion by renaming or switching the names of these important variables.

The reason for the six month delay is this gives the claims an 18 month time period to develop instead of just 12 months.  This is the rule for almost all rate bureaus.

Some of the Rating Bureau Experience Modification sheets can be confusing to read over and compare to your loss runs.  NCCI has many videos that explain how Mods are calculated overall.

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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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