Redefining Workers’ Compensation in Captives: Can It Be Done?

Redefining Workers’ Compensation in Captives: Setting the Stage... The traditional view is that an admitted carrier is needed to write workers’ compensation and employer’s liability coverage on a first dollar basis or in excess of a deductible. 49 states permit state-regulated qualified self-insurance...of those states, 36 permit groups of employers to self-insure. Self-insurance for workers’ compensation has a long history in the United States...SIIA estimates 6,000 businesses nationwide self- insure workers’ comp. The regulation of individual and group self-insurers varies by state...it can be either the Bureau of Workers’ Compensation or the Insurance Commission.

Redefining Workers’ Compensation in Captives: So, What’s Standing In the Way? Regulation? “Custom and Practice”? Lack of coordination between departments in state government? Sufficient lobbying by insurers? Insufficient lobbying by the captive industry? “It just can’t be done...”

Redefining Workers’ Compensation in Captives: So, What’s the Decision? Accrual/ Funding Securitization of Retention Qualified Self-Insurance Statutory Limits Protection Claimant Protection