Workers Comp Reserve Redundancy – The Good, Bad, and Ugly
Workers Comp Reserve Redundancy – Industry Health Measure + Bane of Claims Staff What is a Workers Comp Reserve Redundancy? Why does it keep Claims
May 20, 2021 No Comments
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Workers Comp reserves remain the engine of the Workers Comp claims process.
If your company has a voluntary market policy, then these numbers become the basis for your Experience Modification Factor also known as the E-Mod or X-Mod
For self-insurance, the budgeting process must center around the workers comp reserves.
One needs to think of the reserves as the workers comp adjuster’s forecast of the future payouts over the life of the claim.
Reserving takes many years to learn. Setting these very important numbers can be thought of as an art more than just adding up relevant numbers.
Workers Comp technology has given us predictive analytics for reserving. I am not a fan of predictive analytics as the human body heals differently for each person.
The reserves are divided into three main categories:
Do not expect any state’s department of insurance to intervene if a file contain excessive reserves.
One needs to remember that almost no rules exist for the setting of workers comp reserves for a certain file.
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