Reporting Multiple Employee Occurrences - Worker's Comp Excess Covers

Multiple employee worker's compensation injuries occur in motor vehicle accidents, explosions, building collapse and fires. Customarily claims adjusters establish separate claims files for each claimant and each file will have an appropriate reserve established.
Most specific excess policies provide coverage with a per occurrence retention. This means the claims in a multiple employee accident should be combined as one incident for excess reporting purposes. (Does your data system do this?)


Rick Alford

Assume four employees are injured in an automobile accident and each file is reserved at $100,000 - the total occurrence cost is $400,000. If you (or your insured) purchase a $250,000 retention, the net excess exposure is $150,000. However, if you fail to combine the loss for excess reporting purposes, a specific excess claim cannot be made.

You may rely on large loss reports from your data system to identify files for excess recoveries. Claims from multiple employee occurrences must be coded in the computer on a combined basis or the large loss cannot be properly reported for excess reimbursement.

Recommendations:

1.Determine if your data system can "flag" multiple employee claims.
2.Determine excess claim reporting "triggers".
3.Ask your claim manager to verify how multiple employee accidents are traced and reported.

Richard G. Alford, CPCU, ARM, Are, President, Risk Consulting Services, Inc., Marietta, GA

Richard (Rick) G. Alford, CPCU, ARM, ARe, President
Risk Consulting Services, Inc.
3711 Langley Oaks Place
Marietta, GA 30067-4979
Telephone: (770) 980-0949
rick.alford@riskconsultingservices.com