insurance community university workers’ compensation 5 key issues 1

Insurance Community University

Workers’ Compensation 5 Key Issues

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Welcome to your Insurance Community University

• All of you are currently on mute – Un-mute your own system– Telephone Option

• Select Telephone on your screen• Dial in the PIN number so that your number becomes active

– Microphone and/or Speaker Option• You can use this option if you have a headset that you use with

your computer

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Audio


Participation & Chat Window

• You will receive information from the monitor via the ‘Chat’ window. – Please locate window in the control panel

• Q & A is welcomed during the presentation and at the end of the presentation

• You will find the question box on your control panel– Write your question in that box and send it to the presenter/organizer

• The presenter will take those• questions in the order submitted

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DOI Requirements

• When you see a slide with the hand up symbol, touch the “hand” icon on your control panel– Click ONCE only

• If you do not raise your hand, the monitor will be in contact with you in the chat box

• If you are in a group, the designated proctor is responsible to make certain you are all in attendance at all times

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= Hand is down


Polling

• Throughout the class we will be conducting periodic polls

• We need 100% participation on the polls• The polls are intended to check

participation but also to create discussion topics throughout the presentation

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Forms To Complete for CE

• After class ends– Return attendance form– Proctors – return your form to email

address

• Email address is in chat window or in email sent to you today

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DOI Requirements

• We will file your hours with the DOI after the completion of this webinar and we have received the attendance form.

• You have 48 hours to return the form• You will be sent a Certificate of

Attendance/Completion by email. Please retain this for your records for five years.

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Internet Disruption

• If the presenter looses internet connection STAY ON THE LINE

• The administrators will communicate with you


Internet Failure

• If the internet fails and all participants are kicked off line by Go To Training or other source then the seminar will be terminated

• You will receive instructions by email as to how we will proceed

• This is a precautionary notice, only

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DisclaimerInsurance forms and endorsements vary based on insurance company; changes in edition dates; regulations; court decisions; and state jurisdiction. The instructional materials provided by The Insurance Community Center and its authors is intended as a general guideline and any interpretations provided by The Community do not modify or revise insurance policy language. •Information which is copyrighted and proprietary to Insurance Services Office, Inc. (“ISO Material”) is included in this publication. Use of the ISO Material is limited to ISO Participating Insurers and their Authorized Representatives. Use by ISO Participating Insurers is limited to use in those jurisdictions for which the insurer has an appropriate participation with ISO. Use of the ISO Material by Authorized Representatives is limited to use solely on behalf of one or more ISO Participating Insurers.•The authors of these materials and The Insurance Community Center assumes neither liability nor responsibility to any person or business with respect to any loss that is alleged to be caused directly or indirectly as a result of the instructional materials provided.

www.theinsurancecommunity.com Copyright 2010

All Rights Reserved

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Disclaimer

Insurance forms and endorsements vary based on insurance company; changes in edition dates; regulations; court decisions; and state

jurisdiction. This instructional materials provided by Insight is intended as a general guideline and any interpretations provided by Insight do not

modify or revise insurance policy language. The authors of these materials, Insight Insurance Consultants is a division of Insight Consulting

and Management Inc. In providing these materials, Insight assumes neither liability nor responsibility to any person or business with respect to any loss that is alleged to be caused directly or indirectly as a result of

the instructional materials provided. Copyright 2010 – 2011 All Rights Reserved

www.insurancecommunitycenter.comLaurie: 714.803.5830 [email protected]

Marjorie: 714.206.9583 [email protected]

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Your Instructor Today

Casey Roberts, ACSR, AFIS, CICLaurus Insurance Consulting

707.477.0913Casey@laurusinsuranceconsulting.comwww.laurusinsuranceconsulting.com

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What This Course Will Cover

• Independent contractors, leased and temporary employees

• Locations: employer, work sites, hire, residency

• Third party action over claims and coverage

• Government contracts• Foreign Workers’ Compensation

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Workers’ Compensation Overview

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Workers’ Compensation Overview

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Monopolistic States

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Leased, Temporary Employees and Independent Contractors


The Act

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Employee v. Independent Contractor

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Employee Definition

• An employee is a (natural) person who works in the service of another person under an express or implied contract of hire, under which the employer has the right to control the details of work performance

– Black's Law Dictionary

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IC Definition

• A person or organization hired to perform services under an express or implied contract– NOT subject to hiring party’s control or

manner and means of performing the services

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IRS Guidelines for IC Status

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IRS Guidelines for IC (Hired Party)

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Worker’s Compensation Control

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Polling Question #1

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Locations: Employer, Work Sites, Hire, Residency


Polling Question #2

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Multi-state Exposures

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Multi-state Exposures

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Part 3A – Workers’ Compensation• List all states in which insured has

operations known or expected• If the exposure is known or expected, it

is intended that such state should be listed on the information page

• Activates Compensation Laws for those states

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Part 3C – Other States Insurance

• Allows state benefits to apply in all states allowed by law and not named in 3A– Intended only for the unexpected exposure.

• Work in progress as of inception date will NOT be covered under 3C – MUST be listed in 3A

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Part 3C – Other States Insurance

• Use broad language under 3C “All states except monopolistic states and

states designated in 3A.”

• Without this language – domicile state benefits apply– May be lower than state of injury– Employer will be liable for the difference– Coverage through State Compensation

funds extend state benefits only

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Polling Question #3

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Coverage Examples


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Polling Question #4

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Third Party Action Over Claims And Coverage


Third party over or Action-Over Indemnity

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Example

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Example

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Polling Question #5

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Government Contracts


Government Contracts

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Defense Base Act Background

• Passed by US Congress in 1941• Primary goal

– Cover workers on military bases outside the United States

• Today, after several amendments now includes all public works contracts– Any military installation outside the US– Anywhere outside the US

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Defense Base Act Background

• DBA coverage required for any employee, regardless of their nationality or home country

• Local nationals or third country nationals are covered under the DBA

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Defense Base Act Overview

• Penalties for failure to provide DBA are severe• Failure to procure DBA coverage exposes

employers to penalties – Employers are subject to common law suits– No coverage applies– No common law defenses– No need to prove negligence– Claimants or their heirs need only file suit and do

not have to prove negligence– Suits are brought in Federal Court

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DBA Doctrines

• The Zone of Special Danger doctrine– Employee’s injury or death arises out of or

in the course of employment– The injury takes place in a location where

circumstances of employment place the employee in a zone of danger

– Injury need to be strictly related to specific job duties

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DBA Doctrines

• The Reasonable Recreation doctrine– Employee’s injury arises out of or in the

course of the employer’s furnished, funded or promoted recreational activities

– Includes some non-sponsored activities

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Coverage

• Full medical care• Weekly benefits - % of salary• Re-employment, when possible• Education benefits• Scheduled benefits• Lifetime benefits for lost earnings or

earning capacity on non-scheduled injuries

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Coverage

• A D & D coverage– 24/7 most employees– $50,000 U.S. nationals– $25,000 third country nationals– $2,500 local nationals– Some insurers will increase

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Who Writes DBA

• Long list of authorized insurers• Majority written through

– Ace Marine– Chartis– CNA

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Polling Question #6

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Foreign Workers’ Compensation


Foreign Voluntary Workers’ Compensation• “Standard” WC coverage extends to

extra-territorial workers• May be inadequate to coverage

additional risk– Disease– Foreign nationals– Repatriation

• FVWC provides additional coverage

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Foreign Voluntary Workers’ Compensation

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Foreign Voluntary Workers’ Compensation Coverage

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Standardized Solutions

• Foreign Coverage Endorsement, WC 48 06 03 11 87– Covers a person hired in the U. S. Working

temporarily in a foreign country– Covers BI by accident or disease, including

any endemic disease– War, invasion, and hostilities-caused

injuries not covered

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• Form WC 48 06 03 22 87– Lists the employees to be covered and

which state's benefits are to apply to them– Pays the benefits for the listed state to an

employee injured in a foreign country

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• Excess Repatriation Expenses, Form WC 48 06 03– Covers the difference between transporting

a person under medical care and the normal expenses to have the person travel back to the U.S.

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Policy Provisions

• Extend coverage to include “Travel Assistance” – employees and dependents

• Include coverage for “foreign nationals”– working for the insured– working outside their country of origin

• Include Employers Liability– some jurisdictions require this coverage is placed

locally

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Foreign Admitted WC

• Many countries require compulsory WC coverage – FVWC does not substitute

• Admitted v. Non-admitted– Check with international underwriting desk

to determine which is required by each country of exposure

• Can be written stand-alone or with an international package policy

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Summary

• Although the majority of your clients will need standard solutions, some will need extra attention

• These situations can occur with small, medium or large accounts– Always ask your client about their business

objectives and risks for the upcoming year

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References and Resources• NCCI – National Council on Compensation –

See Silverplume / Sage to Access• WCIRB www.wcirbonline.com• U.S. Chamber of Commerce (202) 463-5381

– 2009 Analysis of Workers Compensation Laws• The Workers Compensation Guide – See

Silverplume / Sage• International Risk Management Institute

www.irmi.com 1-800-827-4242• Your bureau manual – WCIRB, NCCI or

others

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Upcoming Classes

Upcoming University/Paid CE Classes

FREE to University Members$50.00/charge for non university members

5/23 Construction Liability

6/6 and 6/7 Ethics

6/11 Family Medical Leave Act

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Upcoming Community Classes FREE to University Members$25.00/charge for non university members

5/16 Revise your Contracts or Risk Losing Additional Insured Coverage!

Join the University TODAY. www.insurancecommunitycenter.comClick Join University at the top of the bar

insurance community university workers’ compensation 5 key issues 1

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