The Process

OLD NATIONAL INSURANCE

Business Workers Comp.

Call Toll Free at 1-877-896-2886 for your FREE REPORT on

“HOW TO AVOID THE SEVEN DEADLY SINS WHEN BUYING GENERAL LIABILITY INSURANCE”
or click on one of our application links to fax over an application today.  Phones are open Mon-Fri 9 AM to 5 PM CST for Faster Quotes.

“We gladly accept VISA and Mastercard”

Questions to ask yourself:

Are you aware that many businesses may be Overcharged by insurance companies for their Workers Compensation and General Liability Insurance?

Because your real insurance cost is only determined after your policy expires, it is essential the audit is correct.

So why do so many companies get overcharged?

Frankly, you’re at a disadvantage from the start. The insurance company auditor knows the rules, you don’t. The auditor is not compelled by law to explain the rules, especially if applying a rule would cause you to pay a lower premium.

Premiums from audits are the easiest way for the insurance company to get more money from you. It’s simple math…Every dollar the auditor gets goes right to the insurance company’s bottom line and away from yours.

Do you Know How to Avoid Work Comp and General Liability Overcharges?

Misclassifications are common and the WorkComp ‘SYSTEM’ is designed for you to pay for all the mistakes. The audit process is prone to many other errors and omissions in addition to misclassifications.

Do you know how your audits are conducted?

Do you REALLY know?

We help YOU control your audit – so the auditor doesn’t.

Getting your audit done right is just ONE of the 18 proven steps we go through that eliminate the mistakes to stop you from overpaying.

FINAL THOUGHT: Would you allow an IRS agent to conduct an audit without an expert on your side?

Of course not. Then, why allow an insurance company auditor to conduct an audit without an expert at your side?

A Workers Comp audit could actually cost you more money than an IRS audit. A workers comp audit happens every year. You may go years without an IRS audit.

Isn’t it time you took back control of your Workers Compensation and General Liability?

Warning Signs

… of possible overcharges on your Workers’ Compensation and General Liability Insurance policy or audit

Any of these may be a sign that your company has been overcharged on your Workers’ Comp insurance:

  • Your company has been changed to a less-expensive class in recent years (without there being any significant change in your operations)
  • Your Experience Modification Factor was increased after a policy began
  • A more expensive classification was added at the time of the audit
  • A more expensive classification was added to your policy after it began
  • Overtime pay has not been adjusted back to straight time at the audit
  • Your company has not received a special premium credit, such as a contractor’s premium credit for which you qualified in other years

Most people in business that have Workers Compensation think that there is a set rate controlled by the State of Alabama or set by some National rating bureau—-one rate for all!  This is NOT TRUE!

Workers Compensation can be controlled by you.  Our Program, National Work Comp CorrectComp,  can show you how to control this cost.

We are Certified Work Comp Advisors, CWCA.  We have a SYSTEM, a Program to control your Workers Compensation cost!

Let’s take a look—

Why are there MISTAKES and why do they cost you so much?

1.  Record Keeping- the actuarial rating formulas are complex.  To make sure you don’t get overcharged requires that every data item be 100% correct. This includes more than 800 classifications found in the Workers Compensation Manual.

2. Renewal Time is the wrong time to correct mistakes.  In fact, WAITING for renewal will renewal will guarantee that you lose one year of savings that our process generates.  This is why Workers Compensation is so radically different from all other insurance coverage.  And it is why knowing when to correct the MISTAKES is one of the secrets the insurance companies hop now one ever tells you.

3. MISTAKES cost you for 3 years, not just 1 year.

The Institute of WorkComp Advisors, www.workcompadvisors.org has trained me and my colleagues to discover MISTAKES; then we fight for our clients to correct them.

And because Work Comp mistakes stay on your record for three years, not just one, your savings can be substantial.

———————-

Did you know that when the Institute of WorkComp Advisors looked at experience modifications, they found that more than 50% were WRONG! and that over 80% WRONG when business is conducted in more that one state!

Too many people lead to even more errors.

Who checks to make sure all these people working on YOUR account are putting the information into the “SYSTEM” correctly?

WE DO!!

Another question to consider…if you don’t understand your contract, you’re in for a big surprise that could cost you thousands.

What about dividends?  Are they real or illusory?  In todays business environment, who knows if an insurance will even declare a dividend!

Do you realize that you pay $2 to $3 back to the insurance company for every $1 they pay out for many of your employee injuries?  Allow us to show you in black and white that the insurance company does not pay for employee injuries.  YOU do.

How and Why Do Overcharges Occur?

The system for computing Workers’ Compensation insurance premiums is a complicated one, involving interactions between insurance companies, rating bureaus, insurance agents, and of course the insured business. With so many players working with such a complicated system, errors are inevitable.

Consider that, within the NCCI classification system, there are just over 600 different classifications. And the rules for applying those classifications are complex and sometimes counter-intuitive. And of course, they are subject to regular revision.

Additionally, since insurance is regulated on a state-by-state basis, there can be significant exceptions to the rules for particular states, exceptions that are not always well understood even by insurance professionals.

That errors are common is born out by NCCI’s own experience performing what are called “Test Audits”. This is a program where NCCI double-checks the premium computations of insurance companies on a spot-check kind of basis. Error rates of 30% to 40% are reported in the handful of states that have a Test Audit program. But most states don’t have a Test Audit program. (Our home state of ALABAMA for instance, does not have one.) And even in those states that do have one, it’s done on a representative-sample basis, so there is far from a guarantee that all mistakes will be caught and resolved. In fact, it’s clear that they can’t be.

So it’s incumbent upon insured businesses, the ones who ultimately pay for this system, to do what they can to protect themselves from such industry mistakes. For it’s been my experience that most of the mistakes I discover increase premium, rather than decreasing it. I suppose the insurance industry does a better job of catching and correcting those mistakes that cost it money than those that bring in additional income. I don’t know how else to explain what I’ve seen over the years, and it seems to me that it’s just human nature to be more vigilant about mistakes that cost you money. I’m not ascribing any sinister motive to the industry, because it’s been my experience that the insurance professionals I’ve known over the years are among the most dedicated and ethical business people I’ve ever known. But something seems to happen in the operation of the system, something that somehow takes on a life of its own, and causes mistakes that increase premiums to often go undiscovered.

That’s why I’ve come to specialize in helping companies uncover those mistakes, and to recover overcharges that have occurred. The industry, in my opinion, lacks sufficient regulatory oversight to prevent such overcharges, and so a private enterprise solution is called for. That’s where CorrectComp comes in.

We’re experienced in finding and recovering overcharges that occur because of mistakes in classification, Experience Modification Factors, payroll audits, and other technical factors that can increase premiums improperly.

Sometimes, prospective clients tell me that they think their agent should provide such service, and that they expect that they are already receiving such service. But I can only say that, since I have been working in this area, over 50% of the agents are not doing what we do!

I don’t blame agents for this. Most agents are dedicated professionals who work hard to take care of their clients. But many of these technical mistakes that we find are just out of the hands of agents. The system is set up in such a way that it’s difficult, if not impossible, for agents to catch and correct many of the kinds of mistakes we find. For instance, when it comes to determining proper classifications, most of the decision making is out of agents’ hands. That’s handled by insurance company underwriters, the rating bureau, and premium auditors. Agents have to rely on these other parts of the system to perform well, and agents often have very limited authority to overrule decisions made by these others.

It reminds me of what Ronald Reagan said, years ago, about dealing with the Soviet Union in some treaty matter. “Trust, but verify,” he said, quoting an old Russian proverb. It seems to me that, when it comes to Workers’ Compensation premiums, that proverb could serve many businesses well also.

————————————————————————————-

Payroll & Other Remuneration

Workers’ Compensation Insurance

In all States but one, Workers’ Compensation insurance uses remuneration as the exclusive basis for computing premiums. (Washington State currently allows contractors to use hours worked instead.)  But although payroll is the most common component of remuneration, it is not the only one. In most states, the rules about remuneration are written by the National Council on Compensation Insurance, or NCCI.  Alabama is an NCCI State.  But keep in mind that some states are non-NCCI jurisdictions, where there may be some significant differences in how remuneration is defined. The primary differences is that a few non-NCCI states (Delaware and Pennsylvania) do not allow for the premium portion of overtime pay to be excluded. Most other states, even non-NCCI ones, follow NCCI rules in this regard pretty closely. Please keep in mind that this information is offered only as a general guide. We recommend that employers check with their local state regulators to verify what specific rules and exceptions to these general guidelines may apply. Under NCCI rules, remuneration includes:

Regular pay, including salary or hourly;

Commissions;

Bonuses

Overtime pay, less the premium portion;

Holiday, vacation, and sick pay;

Payments by employer of contributions required by law to statutory insurance or pension plans such as Social Security which would otherwise be paid by employee;

Piecework, incentive plans, profit-sharing plans;

Payments to employees for hand or power tools supplied by employees;

Rental value of housing provided to employee;

Value of lodging provided by employer;

Value of meals provided by employer;

Value of store certificates, merchandise, or credits given to employees by employer

Remuneration excludes:

Tips and gratuities received by employee;

Payments by employer to group insurance plans;

Value of special awards paid for invention or discovery;

Dismissal or severance pay except for time worked or accrued vacation;

Value of employer-provided aircraft;

Value of employer-provided automobile;

Value of employer-provided free or discounted aircraft flight;

Value of employer-provided incentive vacation (contest winner);

Employer-provided discount on property or services;

Employer-provided ticket to an entertainment event;

Employer payments to military reservists called to active duty-these payments make up the difference between military pay and employee’s pay prior to conscription.

OVERTIME: The only pay differential that can be adjusted back to straight time, under NCCI rules, is overtime (either time and a half or double time). Other pay differentials, such as paying nine hours pay for eight hours work, can not be adjusted under NCCI manual rules. Also, keep in mind that although most states follow this NCCI rule regarding overtime, there are some exceptions. Pennsylvania and Delaware, for example, do not allow the premium portion of overtime to be removed from the payroll calculation. So always check and make sure about the rules in your particular state or state.

Remember, Workers Compensation policies start with an estimated premium, but after the policy expires the insurance company will want to determine actual audited premium, by determining actual remuneration (or payroll) for the policy period. A good way to avoid mistakes in the audit process is to request a copy of the auditor’s workpapers. This can serve as a roadmap, showing how the auditor determined remuneration and how it was placed into particular classifications.

Workers Comp.

We Now Offer Marine Insurance  and have included some terminology and definitions for our clients:

Admiralty – refers to the common law of the sea, enforced by the federal Courts.  Seamen have certain rights and remedies against their employers under Admiralty Law, if injured on the job or during a voyage.

Jones Act – a federal law that extended the Federal Employer’s Liability Act (FELA) to give injured seamen the right to sue their employer in federal Admiralty courts for their work-related injuries.

Longshore (Longshoreman Insurance)  – literally means “along the shore”. Refers to maritime employment, other than work as a seaman. Includes work building and repairing ships, loading and unloading ships, construction or repair of structures to enable waterborne commerce, and other work on or near navigable waters in support of waterborne commerce.

Maritime – generally means “pertaining to the sea”. In connection with the USL&H Act, “maritime” work means work that meets the “situs” and “status” tests, including  building and repairing ships, loading and unloading ships, construction or repair of structures that enable waterborne commerce, and other work on or near navigable waters in support of waterborne commerce.  Also references work in connection with the Jones Act.

Marina – a property or premises that provides waterfront facilities for recreational boating activities, typically launching, docking, storing, fueling and incidental servicing of boats.

MEL – “Marine Employers Liability” coverage, often provided under a P & I policy or monoline, to protect the employer against his liabilities under the Jones Act and Admiralty law for injury to his employed seamen.   Known as “Maritime Coverage” when provided as an endorsement to a Workers’ Compensation Insurance Policy.

Navigable water – a body of water or waterway which enables travel (in any size vessel) from one state to another or to the Gulf of Mexico or to an ocean

Political subdivision – is a unit of the federal or any state, county, or municipal government, or an agency established by one of them, such as a water district, or school district, or a recreational district

Situs – having “situs” means the work is on or adjacent to navigable waters.

Status – having “status” means the work is generally “maritime” in character, unless specifically excluded in the Longshore and Harbor Workers Act. Work as an employee of a political subdivision is also excluded.

Seaman – a maritime employee who works on a “vessel”, contributes to the functioning of the “vessel” and the accomplishment of its mission, and has a connection to the vessel or a commonly owned group of vessels.  The general working precedent is that an employee needs to spend at least 30% of their time on this vessel or group of vessels to be considered a “seaman”.

USL&H – means the United States Longshore and Harbor Workers Compensation Act, a federal law in many respects like any state’s Workers’ Compensation law, except that it only applies to employers and employees engaged in maritime work.

Vessel – is a ship, boat, barge, or navigable work platform of any size.

Marine Insurance Terminology
This is a general guide only, individual circumstances and policy forms vary.

Bareboat Charter
The charter of a vessel without captain/crew.

Blue Water Vessel
One that sails outside the U.S., typically ocean-going or to/from the Caribbean.

Brown Water Vessel
A vessel, most typically a tug/barge, that operates in the river system or coastal U.S.

Bumbershoot
See umbrella.

Collision Liability
Liability for physical damage to another vessel you might hit. Typically included in the hull policy up to the limit of that hull policy.

DBA – Defense Base Act
A federal workers compensation program for private workers on a U.S. Defense base. It is usually required by contract, and is most frequently covered as part of an international policy.

DOHSA – Death on the High Seas Act
Available to seaman and non-seaman, A tort-based action for anyone who is killed upon the high seas beyond U.S. territorial water.

Excess
See Umbrella.

Hull
Physical damage to your own vessel.

Jones Act
The Merchant Marine Act of 1920, allows seamen a remedy to sue their employer for negligence in the event of injury or illness incurred in service of the vessel.

LOLL – Landing Owners Legal Liability
The inland version of Wharfingers Legal Liability. See below.

M&C – Maintenance & Cure
An absolute, “no-fault” liability to seamen (captain and crew). Maintenance is living expenses Cure is medial expenses incurred until maximum medical improvement.

Marine Umbrella
See Umbrella.

MEL – Maritime Employers Liability
A method of insuring an employer’s liability under Admiralty law (Jones Act, Maintenance & Cure etc.) to his employees. It provides similar coverage for employers as contained in a P&I policy. It does not cover Longshore or any third-party liabilities.

MGL – Marine General Liability
Similar to a normal general liability policy, it is something adapted to expand or eliminate the watercraft exclusion. Typically includes products/complete operations and all usual CGL coverages. It is often based on older versions of CGL forms.

MOLL – Marina Operators Legal Liability
Coverage for physical damage to vessels in the care custody and control. Often limited to “private pleasure vessels” only.

OCSLA – Outer Continental Shelf Lands Act
A federal workers compensation act which allows fixed platform workers on the Outer Continental Shelf access to the Longshore Act.
ORVA – Oceanographic Research Vessel Act
Allows scientists on officially classed research vessels access to the same benefits as seamen, without having to qualify under the Jones Act or sign seaman’s papers.

P&I – Protection and Indemnity
The marine equivalent of Automobile Liability, it covers the liability of a boat owner for bodily injury and property damage. It may include or exclude liability to captain or crew.

Srll – Ship Repairers Legal Liability
Physical damage to vessels, their cargo, and equipment in your care custody and control for the purpose of being repaired, or serviced.

StLL – Stevedores Legal Liability
Liability for cargo being loaded or unloaded from a vessel and damage to a vessel. Usually written with Terminal Operators Legal Liability in a combined form.

TLL – Terminal Operators Legal Liability
Liability for cargo in your care custody and control at a terminal prior to loading or after discharge from a vessel. Most commonly written in combination with Stevedores Legal Liability.

Towers Liability
Liability to a vessel and its cargo that you are towing or pushing.

Umbrella
Or marine umbrella. A combined excess policy. Sometimes has a dropdown provision. May or may not be excess over EL, Automobile or other non-marine policies. Wordings vary greatly.

USL&H
Longshoreman’s and Harbor Workers Compensation Act. (Actually should be LHWCA). It is a federal workers compensation program designed predominately for “dockside” workers.

Wet Charter
The charter of a vessel with a captain/crew.

WhLL – Wharfingers Legal Liability
The marine version of “garage keepers legal liability.” Covers damage to vessels and their cargo which is in the insured’s care custody and control for storage, mooring, docking etc. Usually specifically excludes any repair work.

———-

Longshore Questions and Answers:

What makes my employees eligible for benefits under Longshore?

Injured employees must past two tests: 1) the location of the work must be on navigable waters of the US. or in an “adjoining areaff and 2) the work cannot be excluded under the Act. These are defined in Sections 903(a) and 902 (3) respectively of the Act. Click here for a full copy of the Act


How does Longshore cover my employees?

Longshore works very much like workers compensation except that in lieu of being run by each state individually it is administered by the federal government. Longshore coverage is most commonly provided by endorsing the W.C. policy as there is no coverage for Longshore benefits in the unendorsed policy.

Many states allow officers to be excluded or have a minimum number of employees before I am required to buy workers compensation insurance. Do these follow through to Longshore?

These do not follow through to Longshore. One part time Longshore employee is enough to trigger the need for coverage. Corporate officers doing any form of Longshore work are also required to be covered.


If I have Longshore insurance, do I need WC coverage as well?

Yes. Most businesses will have employees who do not qualify for Longshore benefits (clerical/sales etc) but even if you do not have these classes of employees W.C. provides the insurance necessary to do business in a particular state. The good news is that in most cases with a combined
W.C. Longshore policy the only charge for WC is the normal charge associated with excluded employees.


If I use subcontractors who do not have Longshore coverage what are the ramifications? If your subcontractor does not have coverage for Longshore you absolutely become liable for unpaid benefits regardless of whether you have or do not have coverage.  See Section 904(a) of the Act.


Is a sole proprietorship exempt from Longshore?

A sole proprietor who has no employees can be exempt form Longshore.  However a business is not considered a sole proprietor under Longshore if working “at the direction of another”, which removes most sole proprietor from this exemption.


Can Sole Proprietorships exempt their employees?

No.


How do I obtain Longshore Insurance?

Longshore insurance must be purchased from an insurance carrier approved by the U.S. Department of Labor to write Longshore insurance. A list of approved carriers is available from

It is best to use an agent who is familiar with Longshore to help guide you through that process.  Click here to email an agent:

orharris@oldnationalinsurance.com

Cell Phone for Immediate Response

205-275-5005


Which Insurance companies are allowed to write Longshore Insurance?

Only those approved by the U.S. Department of Labor

A list of approved carriers is available from

However many are approved that rarely write the coverage.  An Insurance Company who specializes in Longshore will provide the correct support and dedicated claims handling.


What happens if I have an injury to a Longshore Employee but no valid Longshore Insurance?

The penalties are severe and are detailed in the Act Section 938.   Simply stated the employer and corporate officers personally are liable for any unpaid benefits under Longshore plus both also lose the protections of the Longshore Act and can be subject to a tort suit in additonal to the Longshore benefits.  In addition there is even the potential for jail time.


If my business is exempt from Longshore, am I also exempt from Jones Act and the other Admiralty liabilities?

No.  The Longshore exemptions have no effect on Jones Act or Admiralty liability.


When does Longshore stop and Admiralty Exposures start?

This is determined on a case by case basis, but the most common rule of thumb is that Admiralty benefits start when an employee spends more than 30% of their time in service of a particular vessel or identifiable fleet of vessels.


How do we report claims?

Claims should be reported to your insurance company as rapidly as possible.

In addition there are certain forms and requirements for filing with the U.S. Department of Labor.  A specialty Longshore carrier will be able to direct you on those.

Make sure you have available in a readily accessible location your carriers claims reporting hotline.  The faster claims are reported the better for everyone.

LONGSHOREMAN INSURANCE (USL&H)

———

Contact Us Today !
806 HIGHWAY 78 WEST
JASPER, ALABAMA 35501
PHONE: (205) 221-5466
TOLL FREE: 1-877-896-2886
FAX : (866) 497-8606
PHONE: 205-221-5472
After Hours Phone:
205-275-5005
Email Us
Quote Requests
Policy Services