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Thread Title: Ins Companies well healed
Created On Friday February 04, 2005 6:03 AM

Hammer
Senior Member

Posts: 750
Joined: Apr 2004

Friday February 04, 2005 6:03 AM

I see ins. companies are doing just fine under SB899.
Safeco is up 58%
Zenith's net more than doubles
Chubb sees high increase in bottom line
Allmerica (Ins Co.) sees 400% net growth.
Workplace homicides jump in 2003 - 81% of 631 victims were females.

SB 899 is doing a great job.
Good work Arnie.!!!!!

Joe-No.1

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wcpilaw@yahoo.com -

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p&i
Junior Member

Posts: 16
Joined: Sep 2003

Friday February 04, 2005 8:11 AM

Just wondering, what does the increase in workplace homicides in 2003 have to do with Arnie?

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Hammer
Senior Member

Posts: 750
Joined: Apr 2004

Friday February 04, 2005 1:10 PM

Everything!!!

He doesn't care as long as IC profits are up........

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wcpilaw@yahoo.com -

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workcompmaven
Member

Posts: 81
Joined: Jun 2002

Friday February 04, 2005 3:55 PM

I still think the well "healed" insurance companies are "kneeded".

Sorry, I couldn"t help myself.

Fred

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mymarykay101@aol.com
Member

Posts: 98
Joined: Apr 2004

Friday February 04, 2005 4:17 PM

Did p&i really ask that?

MK

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Hammer
Senior Member

Posts: 750
Joined: Apr 2004

Friday February 11, 2005 6:27 AM

Today I see that AIG has NET, I say NET, record increase of 11.05 billion.
Ohio Casualty doubles net income.

Absent is any mention of any reduction in WC premiums to CA Businesses.

JOe - No.1

02-15-05

I had to add this bit of info for those that think I am blowing hot air.
AIG was served with subpoenas by the NY atty general this week for questionable practices. ?????

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wcpilaw@yahoo.com -

Edited: Tuesday February 15, 2005 at 9:16 PM by Hammer

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gaiassoul1@yahoo.com
Senior Member

Posts: 1275
Joined: Feb 2004

Friday February 11, 2005 10:10 AM

Just quoting insurance company profits out of context is so misleading. Everytime I see this kind of post my urge to cast spells on ignorance just bubbles over.

DID any CA book of business in a work comp company post an underwriting profit???? I only had time to look up three major insurance companies as to profit centers posting profit. Sorry but the numbers are not good enough to entice me to open up an insurance company doing solely CA work comp, the reward vs. effort is not adding up. Is anyone else interested in not seeing SCIF take over the whole state given the bulk of their claims handling procedures?

You are pointing at national multiline companies with a national base for business profit.

Yet as business people --- if you had a department that consistently posted losses on a income received basis, you would cut that department in a heartbeat, unless you saw a cyclical basis in which you could recover prior losses. So until that has occurred and someone posts the actual facts as to an underwriting profit for an insurance company's CA work comp business you all are DREAMING.

As to the studies on work place homicides -- again you all are lawyers, doctors and other very well educated people, OR are you all just PROPAGANDA machines? The number of work place homicides due to injuries is minimal. SO thanks for more out of context information. The actual fingerpointing for work place homicides goes to increased chemical dependancy, a perceived loss of value as an employee in a marketplace and the overall reduction of wages due to competition with a world marketplace that produces most things much more cheaply because the powers that be in the Federal government signed trade agreements with countries that do not have to live up to regulations the same Federal government foisted on the society here, etc. etc. etc.

When quoting statistics, do you not feel it necessary to read through the crap??? I see some fine minds posting here falling for Michael Moore style fear that is based on questionable information. Ok, I think I broke the soap box from stomping on it in frustration.

Ginger who got an A in every statistics class in college

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Hammer
Senior Member

Posts: 750
Joined: Apr 2004

Friday February 11, 2005 2:07 PM

You read between the lines my dear.

You have an exposed nerve or what????
I am simply pointing out what the latest news is regarding how bad WC Ins. companies are doing.
If you get your shorts all in a bunch, that says something about where you are coming from.

It is no secret that you are an adjuster/def paralegal or whatever you call yourself today and have very strong feelings about what you do.

So do I.

Joe - No. 1

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wcpilaw@yahoo.com -

Edited: Thursday February 17, 2005 at 2:53 PM by Hammer

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fernrep
Senior Member

Posts: 301
Joined: Jan 2004

Friday February 11, 2005 2:43 PM

Sorry, Hammer, but even I, who am on the applicant side, have to say that that comment regarding Ginger ("whatever you call yourself today") was uncalled for. If you ever look at the Injured Worker forum, you will see that she goes way beyond the call of duty to assist injured workers. I realize she works for a defense firm, but I just don't see her as one of those people who feels that her job is to trample on the rights of injured workers. I'm off my soapbox now.

Edited: Friday February 11, 2005 at 2:46 PM by fernrep

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gaiassoul1@yahoo.com
Senior Member

Posts: 1275
Joined: Feb 2004

Friday February 11, 2005 3:13 PM

Joe,

I have been totally honest and upfront with anyone who asks what my current position is. I have never misrepresented my position. You did not just point out how insurance companies were doing, your thread is inflammatory, your unhappy face is inflammatory and so are the comments about SB899 and Arnie, although I don't like either.

Are you afraid of someone pointing out that your post is baseless and lacks in substance despite your education? I was well aware I was delivering a rant, because misquoting statistics for fear based sensationalism is one of my pet peeves. This is equivalent to fear based ethics -- I wouldn't do that because I might go to hell? How about if you just don't do it because it is contrary to other humans?

I have been in this business for 15 years....just an FYI and full disclosure, I started as a medical only clerk, moved to a lien negotiator, did AOE/COE investigations, was an adjuster on and off, held a position as a hearing rep for Chubb for a number of years, did independent hearing work on both sides, and have never in the past two years either represented myself as anything either than a defense firm paralegal or unemployed because that is all I have done for the last two years. I also consult independently with employers as to managing work comp issues, I consult with multiple parties if there are no conflicts, since as we know no private defense firm will ever work for SCIF, I have no conflict consulting with an A/A on a case against SCIF. I do not consult against any other TPA or insurance company because that would be like shooting myself in the head and I have one of the best bosses and work for one of the best, well paying firms in the state.

I am going to get on my soapbox and you will get my panties in a knot if anyone EVER uses scare tactics based on incomplete facts. The reason there is a forum is that people can respectfully state opinions and then the right to disagree is available. SO yes, if you review 95% of my responses you will see balance for the most part, I am my own worst critic as to maintaining INTEGRITY which requires that I follow the law to the best of my ability and I convey that to everyone I come in contact with.

Thank all of the goddesses in the skies I am passionate about what I do, it makes me a worthy adversary. I don't know your last name, but I can almost guarantee if you practice in Southern CA, given the amount of time I have been an adjuster or hearing rep, you have had a case with me. You need to ask some people about me....there aren't that many Gingers in this business. Trust me I am well aware and grounded in my reputation in the work comp community,

My favorite quote goes jointly to Ron Feenberg and Marvin Sharpiro of RKM, Los Angeles, when a very green applicant attorney with a 100% header off the roof case went to them in the midst of negotiations to ask if my offer was fair. Both of them told the A/A that my negotiating style was fair, that "the injured worker would get every penny that the applicant was entitled to, but good luck squeezing out a penny more."

So before you stomp out the spirit of any forum....figure out who you are talking to.

Fern, not all applicant attorney's appreciate what I do on the WC injured workers forum -- in fact I have received private emails telling me to stop. My knowledge scares them, intimadates them and they think they will be out of work if I keep it up (I wish I had that much spare time). However Fern, thank you for pointing out that I believe I have helped not only injured workers, but I have stood up when you and other applicant attorney's were asking questions (today even to APPESQ) and said when I thought the defense attorney were leading them down the wrong path.

If you have any sense of integrity you cannot be less than passionate with balance. So yes if you slam anyone and I think you are too hystrionic, not looking at all of the facts, I will respond. Last time I checked free speech remains my right and forums still are about opinions, I want to make people THINK issues all the way through. So curse the gods and goddesses, if you like, who granted me with way too much IQ and dropped me down on this planet and told me to stay out of trouble, knowing full well I could not. For as far back as I can recall, people either love me or hate me, it has never bothered me one way or the other because I answer to myself and myself alone. When you are your own worst critic, topping what other people do is of no consequence, topping yourself is a daily goal.

Ginger

Edited: Friday February 11, 2005 at 3:26 PM by gaiassoul1@yahoo.com

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Hammer
Senior Member

Posts: 750
Joined: Apr 2004

Friday February 11, 2005 3:42 PM

Paralegal, adjuster, injured worker yourself, and a few other things. I have heard it all before.
You have made the same statements more than once. I am not implying that you are not fair or give fair opinions, I was replying to your very biased comments to my posting of the news that was posted here on WCC.

If you have a problem with that then that is your problem.

I will look forward to meeting you in court, but to bad I will not have the opportunity to go to trial with you. I also have been in the WC field over 25 yrs and would love the opportunity to do a trial with you.

Joe

-------------------------
wcpilaw@yahoo.com -

Edited: Tuesday March 08, 2005 at 6:08 AM by Hammer

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gfisher00@yahoo.com
Senior Member

Posts: 521
Joined: Jun 2003

Friday February 11, 2005 4:18 PM

Hey, Joe, I kind of have to jump in here for Ginger (not that she needs my help, mind you), because I think she was just trying to say that the statistics you quoted don't necessarily mean the insurance companies are making a killing on their WC business. Nor is there a for-sure causal link between workplace suicides and SB899. I have to agree with that. What we need are direct statistics to show the profitability of WC alone, since implementation of the new law, before we accuse the ICs of failing to pass savings on to employers. This doesn't mean I, like you, am not skeptical of the ICs in this regard, just that I don't think those stats are complete.

And to Ginger, in private (so everyone else turn away), as an AA, I think it is great what you do for IWs in the IW forum. Keep it up!

Gilbert

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gaiassoul1@yahoo.com
Senior Member

Posts: 1275
Joined: Feb 2004

Friday February 11, 2005 6:27 PM

You are a brave man with a backbone Gilbert!

Thanks for interpreting my rant.

Ginger

Posts: 76
Joined: Sep 2004

Friday February 11, 2005 8:59 PM

There's an article at the East Bay Business Journal's 1/21/05 edition stating that WC premiums went down 17%. I am not familiar with this publication so it would be a very welcome piece of news if indeed this has merit. Here's the link for the 1/21/05 edition - http://eastbay.bizjournals.com/eastbay/stories/2005/01/24/story8.html

Interesting enough, there was an article at www.consumerwatchdog.org, which reprinted a 5/14/04 article from LA Times, about Garamendi's hopes on premium reduction. The article stated ... "Garamendi, though conceding that the bulk of the new bill's relief won't be felt until next year, said he was likely to recommend that insurers cut rates beginning this summer by at least 18%. The proposed reduction, he said, would reflect savings from this year's law and two other workers' comp bills passed by the Legislature in 2003." The news item also mentioned a Douglas Heller, director of the Foundation for Taxpayer and Consumer Rights, a Santa Monica activist group, who said "......premiums should drop by at least the 14% estimated by the rating bureau." Here's the link to that article FROM A YEAR AGO - http://www.consumerwatchdog.org/insurance/nw/nw004269.php3

It seems to me that the reductions are almost on track with the reform intent (it is off 1% from what Garamendi hoped)..... but it is a wonderful start.

The statement that workplace homicides jumped in 2003 doesn't seem to have any significance in all this anti-SB899 rhetoric, as SB899 didn't get approved until 2004..... you think people started killing people at work because they don't want p.t. to be limited to 24 visits? I'm not sure THAT's worth any jailtime for murder.

And by the way, Gilbert.... I'm not turning around. I've known you to be fair in the mutual cases I used to adjust where you were the applicant attorney .... and that was before I joined the forum. Reading your posts only reinforces that belief. Thanks for being around.

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EXCLUSIVE REPORTS

From the January 21, 2005 print edition

Workers' comp premiums drop by 17 percent

Chris Rauber

California's workers' compensation costs are finally coming down significantly, although not far or fast enough to satisfy many business owners.

Average annual premium rates from some of the state's top workers' comp insurers have declined by nearly 17 percent since January 2004, according to figures from the California Department of Insurance. And some clients are seeing cumulative declines of 24 percent or more.

At the State Compensation Insurance Fund, the quasi-public behemoth that insures about 53 percent of the state's comp market, rates have fallen by an average of nearly 15 percent since early last year.

While cautioning that State Fund "can't project or announce future rate filings," State Fund spokesman Jim Zelinski said, "We do believe the last two reform packages have the potential to realize really substantial cost savings. When those savings materialize, that will be reflected in future rates."

Without providing details, Zelinski said the state government is also starting to see rate reductions for its own employees as a result of the reforms passed by the state Legislature under former Gov. Gray Davis in late 2003 and under Gov. Arnold Schwarzenegger last spring.

Meanwhile, cumulative rate cuts since January 2004 from leading comp insurers such as Zurich American Insurance and Republic Indemnity Co. of California exceeded 24 percent, and those at Liberty Mutual Fire Insurance topped out at an even 20 percent.

Employers Direct Insurance, which entered the market two years ago, has matched Insurance Commissioner John Garamendi's rate-reduction recommendations, said CEO Jim Little, filing for reductions totaling 24 percent over the last 12 months.

Douglas Helm, Employers Direct's vice president of corporate marketing and Northern California sales, said insurers "are competing harder for business in the Bay Area than anywhere else in California."

But the reductions are taking place on a broad canvas.

"Not only are employers' costs going down, but we've turned the tide on medical inflation and for the first time in a decade insurers are not losing money and running in the red," said Nicole Mahrt, a spokeswoman for the American Insurance Association's Sacramento-based western division. "That's going to bring more insurers back into the (California) market."

Indeed, several new entrants have joined the comp fray in California in the past year, and others have expanded their presence in the market, notably units of Warren Buffett's Berkshire Hathaway Inc.

Norman Williams, a spokesman for the Department of Insurance, confirmed that reductions of nearly 17 percent are along the lines of what the DOI and other sources are reporting. Those sources include the Workers Compensation Insurance Rating Bureau, an industry-backed nonprofit that collects data on rates.

Not everyone is satisfied by the recent declines, especially since a beleaguered comp system forced thousands of businesses to swallow huge increases from 2000 through 2003.

Small Business California, a San Francisco-based group representing small businesses, is demanding that insurers quickly align their rates to reflect their improved financial and actuarial results over the last year or so.

Scott Hauge, a San Francisco-based insurance broker and small-business activist who helped create the group, said the WCIRB study proves that insurers "could be passing on even greater savings to small businesses."

In addition, since rates were adjusted upward every six months by hard-pressed carriers in the lean years between 2000 and 2004, "now they should be adjusted down every six months," in the interest of fairness.

Employers Direct's Little said his company's reductions have probably plateaued for the year, barring major unexpected changes, but that other insurers are likely to reduce rates.

"A 24 percent rate reduction in 12 months is pretty dramatic," he said. "(But) other companies may not have been able to go to that level (yet), so we may see rates tend to trend down to the levels recommended by Garamendi by mid-year."

In addition, if the comp market stays stable, "unlike the tortuous volatility over the last eight years, we'll see more capital coming in and we'll see more competitors, which will drive prices down more."

Rauber is a reporter for the San Francisco Business Times, an affiliated publication.

ﾩ 2005 American City Business Journals Inc.
----

Edited: Friday February 11, 2005 at 9:05 PM by CaMiz

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Hammer
Senior Member

Posts: 750
Joined: Apr 2004

Friday February 11, 2005 9:50 PM

Very informative CaMiz:

However, homicides do not = murders.
Homicide is the death of a human being.
Murder is the killing of one human being by another human being.
[Law School first year crim pro..]
You are right murder has no place or reference to the WC situatuion.
However work related deaths = homicides due to unsafe work conditions or serious injuries do.

I do not think IW began to kill one anther on the job because they lost the ptp presumption.

What is totally unrelated here is any mention of murder.

Joe - No.1

-------------------------
wcpilaw@yahoo.com -

Posts: 76
Joined: Sep 2004

Friday February 11, 2005 10:56 PM

<< Murder is the killing of one human being by another human being.
[Law School first year crim pro..] >>

Point taken, I think.
"All I understood about homicides, I learned from Law and Order". Unabashedly guilty.
And from the dictionary.
But I still don't understand how 2004 SB899 = increase in 2003 "workplace homicides"
Its like putting the horse before the cart.
Hm, it must be the Sudafed.

Edited: Friday February 11, 2005 at 11:52 PM by CaMiz

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kenkrasne
Junior Member

Posts: 12
Joined: Dec 2003

Tuesday February 15, 2005 8:58 AM

It really burns me that anyone would defend the IC's in this issue. I am a business owner and my rates have not been reduced despite the fact that I have NEVER had a claim. As a matter of fact, my rates have increased by 7% over last year. SCIF reduced their base rate but then reduced or eliminated their "experience" deductions and others. That is not a savings no matter how they classify it.

I would invite anyone who wants to know if w/c insurance in california is profitable to visit the Weiss ratings and look it up for yourself. I am not a huge proponent of rate control but something has to give.

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gfisher00@yahoo.com
Senior Member

Posts: 521
Joined: Jun 2003

Tuesday February 15, 2005 4:29 PM

Not to get technical here, but actually a homicide is the killing of one human being by another, not necessarily murder, but not simply the death of a human being either. More precisely, and per Black's Law Dictionary, homicide is "the killing of one human being by the act, procurement, or omission of another." Murder is therefore a homicide, as homicide would be a necessary element of murder, or manslaughter, but homicide is not necessarily a murder, as it may lack the intent required to be murder.

As to defending the insurance companies, I am not. They are a business, and entitled to make a profit, like any other business in a market system, and absent controls, to make whatever profit the market bears. That is why if employers wanted lower rates, they should probably have backed some form of rate control, rather than thinking that slimply slashing IW benefits would give them any savings. Perhaps the savings are on the way, perhaps not.

Edited: Tuesday February 15, 2005 at 4:30 PM by gfisher00@yahoo.com

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postscript
Senior Member

Posts: 1053
Joined: Oct 2004

Tuesday February 15, 2005 6:09 PM

For those that know me, I may regret this, but, the IC I work for is a Large National Firm who has reduced writing W/C business down to 15% in California, due to no profits. When reading numbers, be objective of the fact that IC's write multi-lines and W/C in CA has always been a loser (in my 15 years of experience). If they are making profits, they sure don't pass them down to their employees either. Bonus time rolled out for 3 years in a row, take nothing. Ever since I "fell into this business (as a clerk)", I have heard that W/C was included only as a tax write off because of non profiting. Then again, I got "A,s" in college for being objective.

My 5 cents worth.

LCS

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Hammer
Senior Member

Posts: 750
Joined: Apr 2004

Tuesday February 15, 2005 9:05 PM

Gilbert

Thanks for not getting techinical.
Murder is a homicide whenever there is the death of a human being.
The converse is not true.
A homicide is not always a murder. The killing (homicide) of one human being by another.
I believe that is what I stated.

Where is my BAR/BRI when I really need it???

Joe - No.1

P.S.

I do believe we just heard from the business comminity on this issue.
I am sure this business person's opinion is very biased.
Is anyone going to "go on the attack" against this business person.??????????????????

I for one welcome more comments fron the CA business community as they were the ones that were suppose to benefit from this new rate reducing SB 899.

-------------------------
wcpilaw@yahoo.com -

Edited: Tuesday February 15, 2005 at 9:12 PM by Hammer

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Joe
Senior Member

Posts: 270
Joined: Feb 2004

Wednesday February 16, 2005 12:08 PM

I certainly will point out a fact that the business community has failed to mention. When open rating came in premium levels dropped dramatically. It was not unheard of for accounts to be written for 85, 75 or even 50% of the last year's losses. So in essence, for about seven years, the California business community got a free ride. Now that the dust has setled on the market share fight the market has corrected. Sorry, but the business owners of the state are still probably ahead of the game over the last ten years.

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Hammer
Senior Member

Posts: 750
Joined: Apr 2004

Wednesday February 16, 2005 1:11 PM

HelloJoe:

Been a while.

Good point.
Just one question, who was it that pushed for open rating??????

hint: The same (?....) that pushed to get the ptp presumption.

Joe-No.1

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wcpilaw@yahoo.com -

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kenkrasne
Junior Member

Posts: 12
Joined: Dec 2003

Thursday February 17, 2005 8:15 AM

California business owners are ahead of the game? You must be joking? W/C rates are one of many negative factors of attempting to run a business in California. By the way, I have previously owned a similar business in Florida and never paid half of what I pay here for w/c insurance. It is obvious that "Joe" definitely does not run his own business or such an irrational and unfounded statement could not have been made.

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Hammer
Senior Member

Posts: 750
Joined: Apr 2004

Thursday February 17, 2005 2:16 PM

This is good time to point out a clear distinction between to two "Joes" posting here.
That is the reason I had included the addition to my name when signing off.

Joe No.1 & the other Joe come from two very different places.

Joe - No.1

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wcpilaw@yahoo.com -

Edited: Thursday February 17, 2005 at 2:52 PM by Hammer

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Joe
Senior Member

Posts: 270
Joined: Feb 2004

Friday February 18, 2005 1:00 PM

etennant, your reaction is pretty typically short sighted as far as CA employers go. If you look at a the past ten years your premium rates are right where they should be, given a reasonable rate of inflation. The problem, and I sympathize here, is that the rates have fluctuated so wildly. So while the amount you have to pay may seem exhorbitant compared to last year, historically it isn't. I understand how hard the steep decrease and then steep increase makes financial planning.

Joe #1, how did you get to be #1? I was here first

The large carriers pushed for open rating but did have many allies. These included employer's groups as well as some large self-insured employers (who thought they could do better getting cheap insurance than taking all the risk and administering claims). You keep hammering on the PTP presumption as passed by the Legislature as a a defeat for rhe defense (in the long run). The law as passed was not a defeat,. The Minniear decision hijacked the presumption and the former AD did as well. I guess the good guys should have known that the greedy and unscrupolous bad guys would subvert the intention of the bill.

One of the keys to getting the presumption and profitting from it was the idea that employers would enroll in HCO's en masse. That didn't happen so the bill didn't work.

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kenkrasne
Junior Member

Posts: 12
Joined: Dec 2003

Monday February 21, 2005 9:22 AM

How nice is that? I am being told by someone, who is obviously from an Insurance Company, that my rates are right where they should be? I feel so much better now. Up to now, I could have sworn that I was being ripped off but now I can sleep knowing that all is right for us short sighted employers. Give me a break.

California employers are starting to unite and discuss these issues. We are not blindly following the California Chamber of Commerce who also have their hands in the pockets of the Insurance Companies. Don't be surprised to see some new employer groups with legal backing begin to spring up and demand true change and accountability for all the numbers that both the applicant and IC's feed us.

I think the professional forums should be divided further. We could have separate forums for employers, insurance "droids" and applicant representatives. If I seem bitter about insurance companies it is true. They represent only a "necessary evil" in the business world of California just like so many other things.

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Hammer
Senior Member

Posts: 750
Joined: Apr 2004

Monday February 21, 2005 4:45 PM

Joe - being No. 1 has nothing to do with who came first.. " the chicken or the egg"

etennant:

I hear your frustration.
You need to understand that everyone here has a "soapbox"
You -- a CA businessperson that sees no relief in sight to the skyrocketing WC premium rates being charged by ICs.
Me - crying, screaming, kicking, and such because of the "rape" of injured workers by ICs.

Then there are others - not going to mention any names but we know who you are - that due to their many or few years of IC training (????) - Are trained to respond to everything with - Fraud, Fat AAs and CA business has been treated more than fairly for many years, it is the poor ICs that have suffered and need at least three more years just like the last one to recoup their losses.

Joe - No.1

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wcpilaw@yahoo.com -

Edited: Monday February 21, 2005 at 5:56 PM by Hammer

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mymarykay101@aol.com
Member

Posts: 98
Joined: Apr 2004

Tuesday February 22, 2005 1:07 PM

Joe No.1:

I'm picking up on the sarcasm.....

I like it!

MK

Edited: Tuesday February 22, 2005 at 1:08 PM by mymarykay101@aol.com

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motormouth
Member

Posts: 36
Joined: Mar 2005

Friday March 11, 2005 2:36 AM

WOW!!! My first forage into this forum and I am stunned..wow.wow and more wow...
I too have been many things...Adj. Instructor for the IEA, hearing rep for both applicant and defense, lien hound, mommy, 5150 and 5152,but above all...am on the side of WHAT IS RIGHT. However, out of all of the people that I have met in this industry, the most above board person I have even had the great pleasure of knowing is GINGER. She gives until it hurts and then stays around to help you get the bandaid off. Whether you want to hear it or not, she will always tell you the truth and then stay to hear your rebuttal. I have worked for many many carriers and TPA's as a temp and a perm and what I have seen in the past twenty years is the following:
1. Adjustors are NOT well trained. Many newbies have been given cases that they have no business even reading, let alone trying to handle them. The case loads are ridiculous and even more so if you have an incompetent assistant. That will virtually double your work because you also have to check his or her work along with yours.
2. NCM's are worthless and add unnecessary expenses and lots more paperwork to file in your TO FILE bin. They also play both sides of the fence and have no idea what they have done and WILL NOT ADMIT IT.
3. Defense attys bill till it hurts. When I have paid the defense atty more than I have paid the injured worker, I have a real problem with that. Especially when I get the usual monthly bull letter from a da telling me that nothing has changed from last month except here is another bill.
4. Applicant attorney's do not pay enough attention to the benefit printout. Its like a checkbook. When the check is late and there is no 4650 with it...JUMP ON IT dammit.. When there has been no notice sent JUMP ON IT... WAKE UP APPLICANT ATTORNEYS... There is alot more money to be made,,all it takes it some effort on your part and not just to look for the easy throw away C & R.
ADJUSTORS ARE OVERWORKED AND STUFF FALLS INBETWEEN THE CRACKS. Find it and go for it...

Enough already, the powder from the soapbox just flew into the air and it is snowing in Seal Beach!!

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stewshe@comcast.net
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Posts: 1381
Joined: Jun 2002

Friday March 11, 2005 8:32 PM

motormouth, ginger and etennant

ginger: I loved your 2/11/05 comments. Not a rant, a "raison d'etre," too bad the accents don't print right here! I agree with your comments. One thing I'd like to add, which I think you'd agree with: "The only people who never make a mistake are those who don't DO anything." I make a lot of mistakes, but I accomplish a lot...and manage to correct the mistakes when I can. I don't worry about mistakes made, only about the ones I haven't found and corrected. I suspect you feel the same way.)

motormouth, you hit several nails on the head!

I, too, am an ex-IEA instructor, and probably the only one working for an applicant's firm at the time! Seems I was thought by the "community" around Fresno to be honest enough to teach the basic CA 10 course and not corrupt the minds of the "newbies." This was back in 1989 following the reform legislation.

Lack of training in claims people is a constant lament of old timers...like us! I can remember when I was a "newbie" and appealed a case all the way to the Supreme Court of CA because I really did not understand cumulative trauma. (Neither did my supervisor, claims manager, or supervisor in "Home Office!" I'm sure the insured agreed with all of us and could not understand the "unreasonable denial" of our appeal. Fortunately, the WCAB and the courts understood it!

However, I agree with you. I think there should be a license requirement, a minimum proof of competency before an adjuster should be allowed to adjust a claim and deny benefits to an injured worker. It looks like this is the wave of the future as to minimum requirements and continuing education for those with 1 year of experience...just repeated for 10 years, with nothing new learned in the meantime!

Not all NCMs are worthless, but I agree most are. They are paid to cut costs. Only a few have the intestinal fortitude (i.e., "guts" or "cojones") to tell adjusters things they don't want to hear...those are the ones who are not worthless!

etennant: I sympathize with employers, but as much as I hate to say it, Joe really gave you the big picture. One thing I would add, with which I think Hammer and Joe would agree, is that when the deal was cut back in 1992 or so as I recall, the "benefit" of open rating or free-fall, cut throat competition, was supposd to be 50% to employers in terms of reduced premiums and 50% to injured workers in increased benefits, because at the time a worker with an amputated index finger had not seen an increase in benefits since 1958!

(At the time, an injury making someone blind in one eye was worth $14,134.00, increased 7/1/94 to $15,128.50, and $16,277.50 on 7/1/96. Still seems stingy to me! In 2005 the max has increased to $22,165...still way too low, or does anyone disagree?)

Well, guess what!? Benefits didn't increase, but competition did to the point many companies gobbled up market share, hoping to make up for their losses on volume, then went belly up.

Employers in California are still paying increased premiums because of the stupidity of those insurers who wrote business below cost and played games with re-insurance. In a nutshell, this is the argument in favor of rate control.

Did all insurance companies lose money? No, or if they did, they only did for a very brief period. See, e.g., Zenith. The reasons they have done well are a combination of solid underwriting and intelligent claims handling. (A bit simplistic, perhaps, but basically true.)

Also, Joe (not Hammer, Joe #1) aren't you an applicant's attorney?

Hammer has correctly pointed out most of the changes in comp in the last 20+ years have been at the insistence of the insurance industry and self insured employers, who in effect shot themselves in the foot. (And yes, there were some employer lobby groups.) An example is the claim form, the 4906(g) statement, the treating physician presumption, the repeal of rate control, and many others, such as SB 899 which drastically cuts benefits, but also greatly delays the conclusion of claims by cloging the system with complications such as U.R. and a super complicated rating procedure (NOT the new PD Schedule) which by best estimates will allow a rating on only 1 out of 5 reports which purport to be "ratable," which will in turn require additional, supplemental reports causing additional delay. (The 1 out of 5 being ratable equates to "80%" being unratable, an estimate given by Blair Megowan, head of the DEU, at a DWC Conference two weeks ago in Oakland and in January at the CAAA conference in San Diego.)

Prediction: With SB 899 the costs of administering claims will rise. (Yes, pay outs for PD will fall, but what will the result be? That is why carriers are reluctant to lower rates...and a good reason to support rate control. Good companies will do well. The others? Oh, well!)

Last, but not least, Ozzie, as a defense attorney, what is your take on this? Comments?

-------------------------
Stew (James T. Stewart) e-mail: stewshe@comcast.net
Author: Work Comp Index & Tables & Schedules in "The Labor Code Book," by LexisNexis/Matthew Bender.

7th ed. Work Comp Index (912 pgs), $119.00 ea; next ed. summer, 2010 {Discounts for orders of 12 or more}
Send check or money order & shipping info. (I cannot take credit cards.)

Prices INCLUDE sales tax, and shipping.

James T. Stewart; 1937 Santa Ana; Clovis, CA 93611

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Hammer
Senior Member

Posts: 750
Joined: Apr 2004

Friday March 11, 2005 9:36 PM

Stew:

As always, I agree with everything you said.
What role, if any, do you think the crash of the stock market had on the IC's and cause & effect on higher WC rates on policies????

Joe - No.1

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wcpilaw@yahoo.com -

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stewshe@comcast.net
Senior Member

Posts: 1381
Joined: Jun 2002

Saturday March 12, 2005 6:18 AM

Hammer,

I agree, the "crash" or "downturn" or "bear" stock market had a major impact in hurting the cash flow of the insurance companies and in fact was a major factor in causing many of them to go belly up.

The problem is that the "reserves" or money the insurance companies set aside to pay claims was itself tied up in the stock market, so when the market "tanked" (i.e., the price of stock headed for the bottom of the "tank" so to speak), they were left with insufficient funds to pay claims.

In years past there were times, during a strong "bull" market, when an insurance company might have had a loss ratio of 150 (low is good and 100 is break even) and yet they would still make big profits due to their investments.

There were still good and bad years. A few companies managed to go belly up, e.g., Ranger, Mission, Beaver, to name a few, even with a minimum rate law. The reason (to name 1 of many) most of them did so was overextending themselves by writing too much business and not charging enough for the business they wrote, making it unprofitable.

This left them vulnerable when they ended up under reserved on a "book" of business where they underbid the competition at, for instance the minimum rate for an employer with a poor loss history who should have had, e.g., a 50% surcharge. When their investments did not save them from a combination of poor underwriting and poor claims handling decisions, CIGA had to step in and bail them out.

Companies with more sound underwriting and claims handling procedures managed to survive because even though they lost money on their investments like everyone else, they had their reserves at a reasonable level to start with.

I will be the first to admit the above is a simplistic overview, but I believe the broad elements are basically correct.

-------------------------
Stew (James T. Stewart) e-mail: stewshe@comcast.net
Author: Work Comp Index & Tables & Schedules in "The Labor Code Book," by LexisNexis/Matthew Bender.

7th ed. Work Comp Index (912 pgs), $119.00 ea; next ed. summer, 2010 {Discounts for orders of 12 or more}
Send check or money order & shipping info. (I cannot take credit cards.)

Prices INCLUDE sales tax, and shipping.

James T. Stewart; 1937 Santa Ana; Clovis, CA 93611

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stewshe@comcast.net
Senior Member

Posts: 1381
Joined: Jun 2002

Saturday March 12, 2005 6:39 AM

Hammer,

I went back and read what I just posted and saw I did not respond to the rest of your post.

Following the freefall of policies after rate control was abolished, and the bankuptcy of many insurance companies, the "bill" still had to be paid. (As Heinlein said, "There's no such thing as a free lunch.")

All employers in the state are having to pay increased premiums to make up for the artificially low rates which resulted when rate control was abolished and when many policies were written at below cost by companies who later went bankrupt. CIGA stepped in, began paying the claims, and passed the bill onto the insurance companies who in turn raised prices.

Actually, I think this is basically what you previously posted. However, from an employer's point of view, it is upsetting to have no or few claims and yet see premiums increase every year. The reason is as outlined above, but it is still not very satisfying.

SB 899 reformers have blamed "over treatment" by chiros, therapists, PTPs in general, over-aggressive applicant attorneys, unreasonable penalties, TTD which continues indefinitely, etc., when the primary "culprit" was a combination of the abolition of rate control leading to artifically low rates for several years, poor underwriting and poor claims handlings policies, AND a downturn in the stock market when insurance companies were vulnerable.

This created the "bill" for that free lunch which is still being paid.

-------------------------
Stew (James T. Stewart) e-mail: stewshe@comcast.net
Author: Work Comp Index & Tables & Schedules in "The Labor Code Book," by LexisNexis/Matthew Bender.

7th ed. Work Comp Index (912 pgs), $119.00 ea; next ed. summer, 2010 {Discounts for orders of 12 or more}
Send check or money order & shipping info. (I cannot take credit cards.)

Prices INCLUDE sales tax, and shipping.

James T. Stewart; 1937 Santa Ana; Clovis, CA 93611

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davidd
Senior Member

Posts: 498
Joined: Jun 2002

Saturday March 12, 2005 7:00 AM

I'm going to jump in here too Stew with one additional element that was fundamental to the great fall of carriers in the late '90s, and which you touched on but did not elaborate - and it was fundamental to the thinking of the executives that made the investment decisions that ruined so many - reinsurance.

Early 90's Cragwood Underwriters (spelling?) formed the Unicover Partnership, underwritten by large, offshore life insurance companies. I don't know what their business model was, but basically they went around and sold reinsurance at unbelievably low strikes - e.g. where standard reinsurance strike was $100K, they offered to cover starting at $25K (again, this is only an example).

So most execs thought, "what a deal." Good money behind the reinsurance, low strikes, frees up capital from reserves to invest in ... the skyrocketing stock market!!

Then, the joint realities of the stock market crash and the unrealisitic strikes on the reinsurance all tumbled together. Unicover bellied up (and all of the partnership liabilities were, by the way, the subject mostly of off shore arbitration agreements, so no one but the principals really knows what happened to the many billions of dollars that got shifted around) at the same time that the carrier's investments in the stock market evaporated.

The smart carriers didn't buy into the Unicover fiasco, because they knew that something that sounded too good to be true probably is, and many bought real estate as investments (Zenith is a prime example) because for long tail claims you need long tail investments - and those were the ones to survive.

So price competition, in and of itself, was not the catalyst of failure. It was a host of events, but the biggest single contributor was Unicover - had Unicover not failed, claims would have been covered at their strike prices, and carriers likely would have been able to survive the stock market crash.

That doesn't play well to employers, but the alternative is a state run/owned mono-line system, and not all of those are so rosy either...

-------------------------
David DePaolo
President, Editor in Chief
www.workcompcentral.com

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Hammer
Senior Member

Posts: 750
Joined: Apr 2004

Saturday March 12, 2005 7:21 AM

Stew:

Thank you very much for such a great explaination.
I am aware that Mark Ashcraft, manger of the CA. Employers self-Ins program keeps a very close watch on the employers/selfinsured to make sure they keep adaquate $ in reserve to avoid just this situation. Every selfinsured employer can count on an audit of their programs every two or three years. At first glance, it appears very unfair that CIGA / CA employers have to pick up the tab for the poor business practices of these few IC that went belly up.

But the point I keep making in just about all my posts is that that was the true reason that CA business are paying such high WC premiums. It is much easier for the ICs to get new laws passed [SB899, PTP presumption, abolish minimum rate law] by placing the blame over and over again on FRAUD, Fat AA, over treating Chiros & M.D.s I am more than tired of hearing the same old story over and over again. Instead of stating what really happened and the admit the state's failure to properly regulate the insurance industry it is so easy to attack the IW, AA & medical poviders.

We haven't seen the end of this cycle yet. There will be more to come. Even though we are seeing the extremely high profits the ICs are making these days and the extreme hardships suffered by the IW and the very low rates paid to IW, the extremely high WC premiums paid by CA business, the ICs love to ride the creast, especially with Arnie out there ready to take their money to do their bidding.
I know I am stepping out on the edge, someone I am sure will call me an extremist for pointing this out but did you see of the 135 new proposed new bills how many were written in favor of tighter controls on such things as fraud and favorable to the ICs?

I am confident that the ICs will take the position that they are going to kick the dog while its down and go after all the $$$ they can and laugh all the way to the bank. We will soon see a whole new or should I say the same old advertisements about fraud, AAs, chiros, and M.D.s and how they are the reason CA business is having to pay such high premiums. Oh yes, that is why so many companies are leaving the state.

Joe- No.1

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wcpilaw@yahoo.com -

Edited: Saturday March 12, 2005 at 7:29 AM by Hammer

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hutchandsontpa
Member

Posts: 57
Joined: Jul 2002

Saturday March 12, 2005 3:00 PM

I just wanted to point out that Mark Ashcraft is no longer the Manager of Self-Insurance Plans. I believe that honor goes to
Mark Johnson - formally of the Audit Unit.

Carl

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Hammer
Senior Member

Posts: 750
Joined: Apr 2004

Saturday March 12, 2005 8:11 PM

Thank you for the update.

I knew Mark and it has been sometime since I was involved with that program.
I am aware that Mark did one heck of a job keeping on top of the $$$ set aside for reserves.
I hope Mr. Johnson will do as good a job.

Joe - No.1

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wcpilaw@yahoo.com -

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Hammer
Senior Member

Posts: 750
Joined: Apr 2004

Sunday March 27, 2005 2:08 PM

Maurice "Hank" Greenberg, Howard Smith, Christian Milton, Ray Williams & Terry Cassidy

I wonder where they are today??

I am sure they are doing well.

Joe - No1

-------------------------
wcpilaw@yahoo.com -

Posts: 86
Joined: Jun 2002

Monday July 31, 2006 10:32 AM

Mark is working at Bickmore & Accos. in downtown Sacramento he is thier in house consultant...

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laesquire
Senior Member

Posts: 1292
Joined: Aug 2003

Monday July 31, 2006 11:39 AM

When several insurance carriers went bankrupt few on the Applicant side who had the political power to do something about it did.

Now the insurance carriers have the advantage and are making lots of money. The Employers are getting ripped off on the rates. The injured workers under SB 899 are really getting ripped off. Few on the insurance Defense side who has the political power are doing anything about it.

When one side ( Applicant or Defense) has the advantage they think the system is fair. This is regardless how bad the other side is doing.

Hopefully some day the Parties will meet in the middle and come up with a fair compromise that lasts.

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Any posting herein is NOT legal advice. It also does NOT create and attorney-client- relationship.

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