Prior WC Predictive Model Article Was Referring To Claim Reserves
Last Friday, I published a blog article on a predictive model in Workers Compensation. A few emails were received that indicated there were many great software products for predicting E-Mods and other variables in Workers Compensation.
In the original article, I was mainly referring to the fact I have yet to see any predictive model type program that could ever come close to forecasting the reserves for the life of a WC claim. We have reviewed a large number of WC files where a predictive model was used to set the reserves on a file.
The best analytic program model for worker’s compensation reserves is an experienced adjuster handling the same type of injury, employer, and state jurisdiction.
Those reserves had to always to overridden by the adjuster (usually with supervisory approval) at some later point in the file. The healing time of the human body is almost a random length between injured employees. Claims have too many almost random variables in them for claims analytics.
If Liberty Mutual ever shares their massive WC database, we may actually be able to have predictive modeling for claims.
My next article is on Statistics Madness.
©J&L Risk Management Inc Copyright Notice
