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Compensation Insurance Services provides a variety of  services involving the administration of Workers' Compensation Insurance.  Although our specialty is Assigned Risk Administration, we also provide services to related markets such as self insured groups.  Click on Feedback if you would like to  inquire how CIS can provide any of the services shown below to meet your needs. 

bullet Residual Market Mechanism
bulletPlan Administration
bulletPool Administration
bulletServicing Carrier Oversight
bulletServices to the Department of Insurance 
bulletConsulting Services

 

 

Residual Market Mechanism

CIS can create and administer an effective residual market mechanism to meet your state specific needs.  A residual market has a unique character; neither the buyers (the employers) nor the sellers (the industry) are willing participants, and the whole thing is handled by middlemen (the servicing carriers) who are, at once, responsible for both but accountable to neither. Consequently, it is imperative that a residual market mechanism be designed to ensure that:

bulletemployers obtaining coverage through the Plan are afforded a level of service commensurate with the services available to employers in the voluntary market; and
bulletpolicies issued through the Plan and funded by the industry are managed in accordance with cost effective and generally accepted industry practices.

 

 

Plan Administration

The purpose of a workers’ compensation assigned risk plan is to create a market for employers who are in good faith entitled to, but cannot obtain, workers’ compensation insurance.   It is the role of the Plan Administrator to ensure that:

bulletall eligible employers are allowed to participate in the Plan and that eligibility rules are fairly and consistently applied;
bulletemployers obtaining coverage through the Plan are afforded a level of service commensurate with the services available to employers in the voluntary market; and
bulletassigned risk business is equitably distributed among all assigned carriers and policies reinsured through the Pooling mechanism are managed in accordance with cost effective and generally accepted industry practices.

The Plan Administrator accomplishes these goals by:

bulletscreening all applicants to establish coverage eligibility;
bulletinterpreting Plan rules, answering complex questions and administering the Plan’s dispute resolution mechanism;
bulletdesigning and implementing new Plan rules and procedures as necessary;
bulletassisting the approved Rate Service Organization in the development and implementation of pricing and rating programs;
bulletensuring participation in the Plan by all licensed insurance carriers;
bulletdesigning and implementing an assignment mechanism that randomly distributes assigned risk business among direct assignment carriers and Pool servicing carriers in accordance with voluntary market share and/or approved quota; 
bulletassisting the State in the selection of servicing carriers and conducting a competitive bid process as appropriate; and
bulletdevelopment and monitoring of performance standards for assigned carriers.

 

Pool Administration

Administration of a state specific reinsurance Pool includes creation and maintenance of the reinsurance agreements, development and implementation of operating procedures and forms, and collection and dissemination of financial information. The administrator is also responsible for cash management and investment of Pool funds. To facilitate these activities, CIS has developed Pool information systems with the following features:

bulletservicing carriers submit information electronically, resulting in a significant reduction in the time required to compile and distribute financial statements to member companies;
bulletall financial information is collected and maintained in detail, allowing us to produce an endless variety of reports and analyses; and
bulletfinancial and policy databases are interfaced and historical paid loss and reserve development data are maintained on-line to facilitate computation of IBNR reserves and assist with cash flow management.

In Mississippi, remitted funds are held and invested at the Pool level until needed to reimburse servicing carriers for paid losses or until they are available for distribution to members.  The cash management system we’ve developed virtually eliminates the problems of member company insolvency and at the same time provides investment income at market rates utilizing investments.

 

 

Servicing Carrier Oversight

Employers who obtain their workers' compensation insurance through the residual market are entitled to the same level of service as employers who get their coverage from a carrier they have selected themselves.  Likewise, the voluntary carriers who fund the residual market have every right to expect that services rendered on their behalf will be both professional and cost effective.  The key to attainment of both objectives is servicing carrier performance.

CIS provides servicing carrier oversight including  conducting on-site performance evaluations. In addition, we are responsible for all staff work associated with the selection and compensation of servicing carriers and have been instrumental in developing compensation and incentive strategies and alternatives to the traditional servicing carrier model.

 

 

Services to the Department of Insurance 

The ability to capture and report data is important. The skill to turn that data into timely and useful information is essential.  CIS can be a Department’s information resource rather than simply a data reporting service. We provide advice and counsel on workers compensation and residual market matters and analyze and report major trends. From time to time we publish and distribute information pertaining to the residual market and we represent the Department at industry meetings and conventions. We can be the Department’s primary tool for strategic planning and have developed a number of initiatives (from alternative funding mechanisms to small employer payment plans) that will improve the state of the residual market in your state for both employers and member companies.

 

Consulting Services

Compensation Insurance Services has been providing  administrative services to the workers compensation residual market since 1993. We have developed and administered RFP's to select companies to service the assigned risk market, as well as, self insured groups.  We can provide consulting services to enable you to set up and administer your own operation, or administer it for you and train you to ultimately administer it yourself. 

 

 

 

 

 

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