Carriers Get Opt Out Workers' Compensation Products Approved in OK
While this writer will always be concerned with any product that provides anything less then exclusive remedy on a statutory limit basis, it should be noted that three carriers now have approved filings in Oklahoma to provide opt out products in place of workers' compensation (alike Texas). Generally crafted as a variation of an accident and health policy, they often mimic the triggering events of a workers' compensation policy.
I suppose this product has its place for some exposures, but we are very skeptical of traction based on the dramatic improvements in the market lead by our friends at CompSource.
We view this new provision to opt out as an overreaction to a system that had become a top ten lost cost state in the country for workers' compensation. Key reforms and a well run competitive state fund in recent years drove 11.9% out of loss for 1.1.2014 rates. This data represents years 2010, 2009, 2008, 2007 and 2006. Our data suggests an even better trend based on years 2012 and 2013 where reforms have take further hold, the economy has improved so payroll and retention is up and the oil and gas industry continues to rapidly expand. We consider Oklahoma a buy. Very fertile growth market with another tool now available --- Safety National, Great American and One Beacon are the first horses out of the gate on this front.
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