Why The Number 36 Is A Crucial Policy Dispute Time Limit
We are contacted at least twice a month where the policy dispute time limit comes into play.
For example, recently J&L was able to find multiple major coding errors on various claim files that stretched back at least two decades. The employer contact became furious that we could not go back to the early 2000s with the errors and recover from over 20 policies.
I tried to explain that 36 months after the policy expiry was the policy dispute time limit. Most worker comp policies contain language that directly addresses this policy dispute time limit. One needs only to look at Section G in most standardized workers comp policies in NCCI states.
The unfortunately unhappy employer did receive back a premium refund for the prior three years and the current policy was corrected.
That Also Works For the Insurance Carrier
The workers’ comp policy dispute limit also applies to insurance carriers. What if the tables were turned and the insurance carriers were allowed to perform premium audits 20 years into the past? I have only seen one carrier attempt auditing 10 years into the past. One letter to the carrier pointing out the time limits (in the policies) was all that it took to stop the audits.
The 10-year audit was produced by a rogue independent company auditor.
Reason For Using 36 Months And Not Three Years
Yes, I and many people reading this article say that 3 years is the limit. I agree, but whenever I use 36 months, insureds tend to pay more attention to the dispute time limits. For example – in three years, we have plenty of time to raise a dispute. Thirty-six months makes the time look shorter. You are in the 34th month out of 36 vs. the 2nd of 3 years.
California allows a shorter timeframe. Check out the link for a 2010 article on the subject. As I try to write articles that cover all states, many exceptions exist to the 36-month time limit.