niche programs and unique reporting topics...niche programs and unique reporting topics ncci’s...

Niche Programs andUnique Reporting Topics

NCCI’S 2016 DATA EDUCATIONAL PROGRAM

January 26–29, 2016

Palm Beach County Convention CenterWest Palm Beach, FL

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© Copyright 2016 National Council on Compensation Insurance, Inc. All Rights Reserved.

Niche Programs and Unique Reporting Topics

Presented by: Julie Gonzalez and Renee Retterath

© Copyright 2016 National Council on Compensation Insurance, Inc. All Rights Reserved.2016 DATA EDUCATIONAL PROGRAM

Objective

To provide an overview of niche type programs and unique topics, and discuss their data reporting requirements across multiple data types.

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Agenda

Niche Programs

Voluntary Compensation

Employers Liability Insurance

Retrospectively Rated Policies

Excess Policies

Wrap-Up Programs

Unique Topics

Catastrophe Provisions Anniversary Rating Date Uncooperative Audit Ratable and Non-Ratable

Groups Supplemental Diseases Lump Sum/Settlements Medicare Secondary Payer State Specific: Missouri Mesothelioma West Virginia Deliberate

Intent Coverage

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Data Types—Usage

Policy Data• Proof of

Coverage• URC

Program• Premium

Trends• Exposure

Trends

Financial Call Data• Statewide

Premium Level Indications

• Industry Results

Unit Statistical Data• Experience

Rating• Class

Rates/Loss Costs

• Legislative Analysis

Detailed Claim Information• Legislative

Analysis• Research

Medical Call Data• Legislative

Analysis• Research

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Niche Programs


What Is a Niche Market?

Subset of the market on which a specific insurance product is focused

Defines the insurance product features aimed at satisfying: Specific needs Cost Demographics

Small market segment

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Coverage for workers not required under statute—optional coverage

Examples: Domestic workers, farmers, casual worker

Benefits equivalent to statutory benefits

Separate payroll records must be maintained

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WC 00 03 11 A—Voluntary Compensation and Employers Liability Coverage Endorsement

WC 00 03 12 A—Voluntary Compensation and Employers Liability Coverage for Residence Employees Endorsement

Basic Manual Rule 2-1


Foreign Voluntary Compensation Coverage for employees who are hired within the United States, but travel and work outside of the United States

Employees in a specific country for a designated maximum number of consecutive days

Optional additional coverage for repatriation expenses

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WC 09 04 06 A—Florida Foreign Voluntary Compensation and Employers Liability Coverage Endorsement

WC 06 04 02—Connecticut Foreign Voluntary Compensation and Employers Liability Coverage Endorsement

Carrier Independently Filed Endorsement for Foreign Voluntary

Basic Manual Rule 2-I (CT and FL Exceptions)

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Reporting Voluntary and Foreign Voluntary Compensation

Policy: Endorsement Identification Record: WC 00 03 11 A WC 00 03 12 A Florida—WC 09 04 06 Connecticut—WC 06 04 02 Carrier Independently Filed Endorsement

for Foreign Voluntary (appropriate endorsement #)

Type of Nonstandard ID—Code 09: Voluntary and/or Foreign Voluntary Coverage

Applicable for Foreign Voluntary Compensation

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Reporting Voluntary and Foreign Voluntary Compensation

Unit Statistical:

Header Type of Nonstandard ID—Code 09: Voluntary

Coverage Not Mandated by State Act:

Exposure/Premium Classification code Do not report additional repatriation coverage

charge (no statistical code)

Paid/Incurred Losses Report the entire claim amount, including

repatriation losses and expenses

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Reporting Voluntary and Foreign Compensation

Financial Calls: Premium:

Report audited premium for both Voluntary Compensation and Foreign Voluntary Compensation insurance in DSR Level, Co. Standard, Net

Premium for additional (optional) repatriation coverage (Net Premium only), excluded from DSR Level and Co. Standard Premiums

Paid Losses and Case Reserves: Report the entire claim amount, including repatriation

losses and expenses

DCI and Medical Data Call: No unique reporting exceptions or values

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Employers Liability (E/L) Insurance

Coverage to protect employers from negligence claims

Employers Liability (Part B)

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Employers Liability (E/L) InsuranceTypes:

1. Employers Liability With or Without Workers Compensation

Standard Limits of Liability: Accident ($100,000) Employee ($100,000) Policy ($500,000)

2. Increased Limits of Liability: Additional percentage is applied to premium

3. Minimum Premium for Increased Limits

4. Stop Gap Coverage—Monopolistic Funds (ND, WA, WY, OH): E/L coverage—employers buy coverage from private insurers

Basic Manual Rule 3-A-14Statistical Plan Preface—A-1

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Reporting Employers Liability (E/L)

Policy:

Report Limits of Liability Accident Employee Policy

Statistical Codes Corresponding to E/L Increased Limits Balance to Minimum Premium for Increased

Limits—Code 9848

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Unit Statistical:

Statistical Codes corresponding to E/L Increased Limits

Balance to Minimum Premium for Increased Limits—Code 9848

Statistical Code 9139—Flat Charge for Employers Liability/Voluntary Compensation

ALAE associated with E/L is included in incurred indemnity and paid indemnity loss as appropriate

Claim with WC and E/L—Report as one claim

Type of Claim—Loss Conditions E/L only—Code 02 WC with E/L—Code 03

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Financial Calls: E/L and E/L Increased Limits —Include in DSR Level,

Company Standard, and Net Premiums

Stop Gap Coverage—Don’t include in any premium columns

Indemnity Claim Count/Large Loss Claims Report as one claim when there’s WC and E/L (Increased Limits)

coverage

DCCE associated with E/L should be reported in the Indemnity Losses (use as a Reason for Difference on Call #8) Call #19—Ensure that losses and expenses are reported in the

same fashion as the NAIC Annual Statement data


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Retrospective Rated Policies

Premium based ultimately on employers’ loss experience during applicable policy year

Annual loss review and premium adjustment for a preset number of years after policy expires

Includes Loss Sensitive Rating Plan (LSRP) and Large Risk Alternative Rating Option (LRARO)

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Reporting Retrospective Rating

Policy: Retrospective Rating Code 5

Unit Statistical: Retrospective Rated Policy Indicator = Y

Report audited payroll/premium on 1st report Do not report:

– Premium Adjustments—No statistical code, no corrections to 1st report

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Reporting Retrospective Rated Policies

Financial Calls:

Report Audited premium in DSR Level, Company Standard, and Net Premiums

Retro Adjustments—Included in Net Premium only; excluded from DSR Level and Company Standard Premiums


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Wrap-Up Construction ProjectsBasic Manual Rule 3-A-23

Policies are issued by one carrier to two or more legal entities

Classifications assigned to each separate legal entity based on operations

Designated Workplace Exclusion Endorsement (WC 00 03 02)

Owner Controlled Insurance Program (OCIP) or Contractor Controlled Insurance Program (CCIP)

Owner/General Contractor

Electrician Steel Framers Plumbers

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Wrap-Up Policy Example

5-Year Wrap-Up Program

2010–2015

Wrap-Up PolicyPolicy # Wrapup110/1/10–10/1/11



Wrap-Up Policy Policy # Wrapup4 10/1/13–10/1/14

Wrap-Up Policy Policy # Wrapup5 10/1/14–10/1/15

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Wrap-Up Policy


Bob’s PlumbingPolicy # Wrapup1B10/1/10–5/1/11

Bob’s PlumbingPolicy # ABC

1/1/10–1/1/11

Manny’s SteelPolicy # Wrapup1C12/1/10–10/1/11

Manny’s Steel Policy # GHI

1/1/10–1/1/11

Julie’s WiringPolicy # Wrapup1D

1/1/11–5/1/11

Julie’s Wiring Policy # MNO

1/1/11–1/1/12

Richard’s Concrete Policy # Wrapup1E 10/1/10–10/1/11

Richard’s Concrete Policy # XYZ

1/1/11–1/1/12

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Wrap-Up Policy

Wrap-Up PolicyPolicy # Wrapup110/1/10–10/1/11Deductible Program

Bob’s PlumbingPolicy # Wrapup1B10/1/10–5/1/11

Manny’s SteelPolicy # Wrapup1C12/1/10–10/1/11

Julie’s WiringPolicy # Wrapup1D

1/1/11–5/1/11

Richard’s Concrete Policy # Wrapup1E 10/1/10–10/1/11

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Reporting Wrap-Ups Policy: Wrap-Up/Owner-Controlled Insurance Program (OCIP)—

Code 1 (Master and Subcontractors) Designated Workplace Endorsement (WC 00 03 02) Deductible Endorsement

Unit Stat: Separate unit reports (exposure/losses) by contractor Deductible program type (mirror Master Policy) Deductible Credit Stat Code, if applicable:

Code 9664—Subject to Experience Modification Factor Code 9663—Not Subject to Experience Modification Factor Code 9657—Not Part of Standard Premium

Loss reimbursement for net deductible program

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Wrap-Up Policy—Financial Calls

•Exclude all premium, loss, and expense from Policy Year/CAY Calls*

Large Deductible

Policy

•Report all premium, loss, and expense in Policy Year 2010

Other Than Large

Deductible Policy


*Exception—FL Calls 20/21 (Large Deductible)

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Reporting Wrap-Ups Financial Call: Deductibles*:

If No or other than Large, include premiums, losses, DCCE in Ratemaking Calls

If Large, exclude from premiums, losses, DCCE, and account for data on Call #8 (FL exception—LD calls)

Premium Credits—Include in Net Premium and exclude from DSR Level and Company Standard

*Follow reporting instructions on what to include/exclude

Master Wrap-Up Policy that covers multiple years must be reported as separate policies with individual effective dates for each of the annual components. Mirror Policy Effective Dates reported on units.


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Excess Policies

Insurance that doesn’t pay until the loss exceeds an agreed upon amount—Typically above the loss limit in the insured’s Workers Compensation policy

This amount may or may not be insured elsewhere

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Excess Policies

Offered to qualified self-insured employers; coverage for losses above a set amount

Target markets—contractors, oil field service industry, and maritime operations

Often combined with claims administration and safety and loss programs

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Reporting Excess Policies

Excess policies are generally NOT reportable on any NCCI data type

Two Exceptions: Excess policy tied to West Virginia Deliberate

Intent Coverage Financial Calls—Report only if you report

Excess data to NAIC, Page 14, Line 16 (WC Line) Calls #1, #1A, #8 (reconciliation item), #14,

#19, and #26 (Addendum to Call #19 only) Exclude Excess data from all other Calls

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Pick the Answer

Questions

Covers One Job Location

Increased Limits

Coverage Not Required

Above Workers Compensation

Coverage

Answers

Employers Liability

Excess Policies

Wrap-Up Policy


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Unique Reporting


Catastrophe Provisions Premium surcharge for catastrophe or terrorism-related

programs NCCI evaluates premium surcharges as part of its

ratemaking process

Types: DTEC (Domestic Terrorism, Earthquakes, and

Catastrophic Industrial Accidents) TRIA (Terrorism Risk Insurance Act of 2002) TRIEA (Terrorism Risk Insurance Extension Act of

2005) TRIPRA (Terrorism Risk Insurance Program

Reauthorization Act of 2007 and 2015)

Basic Manual Rule 3-A-24 and Miscellaneous Values

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Reporting Catastrophe Provisions Policy:

Endorsements: Terrorism Risk Insurance Program Reauthorization Act

Disclosure Endorsement (WC 00 04 22 B) Florida Terrorism Risk Insurance Program Reauthorization

Act Endorsement (WC 09 04 03 B) Catastrophe (Other Than Certified Acts of Terrorism)

Premium Endorsement (WC 00 04 21 D) Record Type 07 (Endorsement Identification Record)

Statistical Codes: Code 9740—Catastrophe Provisions for Terrorism Rating

(TRIPRA) Code 9741—Catastrophe Provisions for Catastrophe (other

than Certified Acts of Terrorism) Reporting of exposure, rate, and/or premium

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Reporting Catastrophe Provisions Unit Statistical: Include appropriate statistical code Report exposure, rate, and/or premium

Financial Data: Exclude from DSR Level, Company Standard,

and Net Premiums on Calls #3, #3A, #5, #5A, #20, and #21 Report as a line item on Call #8 Include on Calls #1, #1A, #1B, #1C, #1D, and

#14

DCI and Medical Data Call: Premium not applicable

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Uncooperative Audit or Audit Noncompliance

Carrier has the right to examine and audit all policyholder records

Certain states allow carriers to charge additional funds if insured is: Uncooperativeand Carrier is unable to verify the necessary data

for a final audit

Additional funds cannot exceed several times the most recent estimated annual premium

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Uncooperative Audit or Audit Noncompliance

State-Specific Endorsements:

If insured refuses to cooperate in completing a final audit, they must pay additional funds not to exceed several times the most recent estimated annual premium

Separate charge if applicable from class code manual premium

Note: Countrywide Item Filing B-1429—Establishment of Audit Noncompliance Charge

Effective 1/1/2017

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Reporting Uncooperative Audit or Audit Noncompliance

StatePolicy

Endorsement Statistical Code Basic Manual

CO WC 05 04 049757

(not part of standard premium)Audit Noncompliance Charge—Amount not specified (carrier must file with DOI for approval)

MT WC 25 04 019757

(not part of standard premium)Audit Noncompliance Charge—Amount not specified (carrier must file with DOI for approval)

FL WC 09 04 079757*

(not part of standard premium) *FLJUA Only

Audit Noncompliance Charge—Not to exceed three times most recent estimated annual premium

MO WC 24 06 04 A9757

(not part of standard premium)Audit Noncompliance Charge—Equal to estimated annual premium

SC None9656

(Independent Carrier Filing)

May increase payroll up to a maximum of three times the estimated payroll for purposes of determining the final premium

GA WC 10 04 029656

(Independent Carrier Filing)

May utilize a payroll amount of three times the estimated payroll for purposes of determining final premium

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Reporting Uncooperative Audit orAudit Noncompliance

Policy: Applicable endorsement

Unit Statistical: Report applicable Statistical Code 9757 for CO, MT, FL, and MO Use Statistical Code 9656 (Independent Carrier Filing—

Premium Debit Not Part of Standard Premium) for SC, NC, and GA

Do not apply the additional charge to payroll/premium

Financial Calls: Report data associated with Statistical Code 9757 or 9656 in

Net premium, (only if included in the NAIC Annual Statement), exclude from DSR Level and Co Standard Premiums

DCI Medical Data Call: Premium not applicable

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Anniversary Rating Date

Basic Manual Rule 3-A-2:

Effective month and day of policy in effect unless a different date has been established

Countrywide Item Filing B-1430—Elimination of Anniversary Rating Date (ARD)

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Anniversary Rating Date (ARD)

Policy:

ARD field on Policy State Premium Record

Unit Statistical:

Rate Effective Date and Modification Effective Date

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Anniversary Rating Date (ARD)

Financial Call:

If ARD is different from the PED ARD determines the appropriate DSR Level

PED determines which Policy Year to report experience

DCI and Medical Data Call:

Premium not applicable

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Ratable/Non-Ratable Groups

Basic Manual Rule 3-A-17 (non-ratable element):

Class codes designated with an “N” have corresponding statistical codes (non-ratable element)

Non-ratable element is a supplementary loading in the manual rate for a classification

Adjusts for the classification’s potential for occupational disease/catastrophic losses

Premium for a non-ratable element is not subject to experience rating or retrospective rating

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Ratable/Non-Ratable Groups

Florida Example:

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Policy: Report exposure, rate, and premium

Unit Statistical: Report exposure, rate, and premium

Financial Calls: Included in all Calls

DCI and Medical Data Call: Premium not applicable

Non-Ratable Groups

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Supplemental Disease Exposures

Basic Manual Rule 3-A-7 (Disease Loading): Supplemental disease loading may be added

Incidental Foundry, Asbestos, Abrasive, Sandblasting, Atomic Energy Radiation Exposure, Silicosis

Not subject to experience rating or retrospective rating

Florida Example:

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Statistical Codes for Supplemental Disease

0059—Abrasive or Sandblasting

0065—Incidental Foundries—Steel

0066—Incidental Foundries—Non-Ferrous Metals

0067—Incidental Foundries—Iron

0133—Supplemental Disease Experience—in Connection With Asbestos Exposure

0179—Disease Experience—Supplemental

9985—Atomic Energy—Radiation Exposure NOC

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Policy: Report exposure, rate, and premium

Unit Statistical: Report exposure, rate, premium, and loss

Financial Calls: Included in all Calls


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Settlements

Agreement between carrier and claimant regarding WC payments and future medical care

Lump-Sum Settlement:

Final settlement which allows benefits to be paid all at once instead of over time

Discounted or commuted value of a specific award or benefit

It’s possible to finalize some types of benefits and leave other benefits (e.g., medical) open

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Reporting Lump-Sum Settlements

Policy: Not applicable for losses

Unit Statistical: Lump-Sum Settlement—Y/N Indicator

Settlement Type—Discounted/Commutative

Claim Status

Allocated between Medical and Indemnity (should not be an automatic 50/50 split)

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Reporting Lump-Sum Settlements

Financial Call: Losses: Allocated between Medical and Indemnity

(should not be an automatic 50/50 split) If subdivision is unknown or unspecified, use case

values prior to the settlement adjustment to determine proration

Detailed Claim Information: Lump-Sum amount paid Benefits covered by Lump-Sum Code

Medical Data Call: No unique reporting exceptions or values

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Medicare Secondary Payer (MSP) or Set-Asides (MSA)

Funds set aside to cover expenses for futuremedical services related to a condition or injury covered by a plan or policy other than Medicare (i.e., workers compensation medical benefits)

Workers compensation pays first, and the secondary payer is Medicare

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Reporting MSPs or Set-Asides (MSA)

Policy: Not applicable to losses

Unit Statistical: Medical loss reported includes “set-aside” to

cover future medical costs, management fees

MSP service provider fees are reported under ALAE

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Reporting MSPs or Set-Asides (MSA)

Financial Calls:

Medical Losses—Report MSP or Set-Asides to appropriate Claim/PY/AY

MSP service provider fees reported in DCCE

DCI and Medical Data Call:

No unique reporting exceptions or values

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Missouri Mesothelioma

Additional benefits for occupational diseases due to toxic exposure diagnosed as Mesothelioma—results in Death or Permanent Total Disability (SB1—Effective 1/1/2014)

WC 24 03 02—Missouri Notification of Additional Mesothelioma Benefits Endorsement

WC 24 03 03—Missouri Exclusion of Additional Mesothelioma Benefits Endorsement

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Charge or Credit for Additional Mesothelioma Benefits

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Reporting Missouri Mesothelioma

Policy: Applicable endorsements

Applicable credit or charge, if any

Unit Statistical: Charge for Additional Mesothelioma Benefits—

Independent Carrier Filing statistical code

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Reporting Missouri Mesothelioma

Financial Calls: Report additional charge in Net Premium;

exclude from Company Standard and DSR Level Report all applicable losses

DCI and Medical Data Call: Not applicable for premium No unique reporting exceptions or values for

losses

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West Virginia Deliberate Intent Coverage

Additional Coverage to cover acts (injuries) deemed intentional or acts caused by deliberate intention by the employer

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Reporting West Virginia Deliberate Intent Coverage

Policy: Endorsement (WC 47 03 01A) Provided via WC/EL policy endorsement or “excess” policy Code 9614—Exposure Flat Premium—Report “1” for exposure, “0” for rate, and “Flat

Charge” for premium No Premium—Report “1” for exposure, “0” for rate, and “0” for

premium

Unit Statistical: Type of Nonstandard ID Code 05—Excess Policy Exposure Act Code 07—Excess Benefits Coverage Report corresponding premium, losses, and expenses under

Code 9614 Loss Condition Code—Type of Claim 05—Excess Benefits

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Reporting West Virginia Deliberate Intent Coverage

Financial Call: Exclude any experience associated with the optional West

Virginia Deliberate Intent (Mandolidis) Coverage from all Calls Adjusting and Other Expenses—Excluding any fees associated

with determination of West Virginia Deliberate Intent coverage

If any experience associated with West Virginia Deliberate Intent coverage is reported on your company’s NAIC Annual Statement, it will be a Reason for Difference on Call #8

DCI: Exclude claims solely with West Virginia Deliberate Intent

Coverage

Medical Data Call: No unique reporting exceptions or values

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Additional Benefits for Mesothelioma

Name the State

Florida1

Missouri2 West

Virginia3

Has an Audit Noncompliance Endorsement

Deliberate Intent as an Excess Coverage

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Supplemental Information

Presenter Biographies

Julie Gonzalez, AIDM, has been employed at NCCI since 1992. As a data consultant and project manager in the Data Services Department, her main responsibilities include managing NCCI’s Data Educational Program, overseeing major compliance projects, developing new data reporting requirements, and enhancing NCCI’s external training programs and data tools. In addition, Julie actively participates on industry committees and association forums to forge industry relationships and provide subject matter expertise.

Prior to joining Data Services, Julie was a senior underwriting analyst, responsible for filing workers compensation rules and programs, and managing the appeals board mechanism for several NCCI states.

Julie has earned both her Associate in Commercial Underwriting (AU) and Associate Insurance Data Manager (AIDM) designations.

Renee Retterath has worked at NCCI for 13 years and is a senior data consultant in the Data Quality and Compliance Department. She is responsible for the development, implementation, and monitoring of the various quality assurance programs for the collection and validation of customer data.

Renee has a master of science degree in school psychology from the University of Wisconsin- Stout.

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