California Work Comp Reporting, The State is Getting Stronger
Good afternoon from the NCCI Annual Issues Symposium in Orlando, Florida!
With the advent of cloud computing and business intelligence platforms, the power of understanding the industry's true performance lies with those who can organize and interpret data. Although the NCCI has done a wonderful job providing Workers' Compensation industry leaders with the most credible and largest wealth of information, a changing landscape in information technology and data has provided perspective to the lag-time of approximately 1-2 years when Workers' Comp providers report to the national and state bureaus. PEO Compass, using analytics and industry data from RiskMD, will report on its position of the state's performance alongside NCCI's position, to allow industry experts to take a deeper dive into the information. On the graphic below, we have highlighted the state of California which represents 20% of workers’ compensation premium for the country; as a result, trends in California tend to be much more meaningful than other states. With advanced analytical systems like RiskMD, one can see information as of this past Friday versus the 1-2 year lagged reporting of the bureaus.
California PEO Loss Ratio Study
Because of the speed in which PEOs report payroll and premium for client companies, we are able to show live heat maps back to our PEO community representing areas where both average claims cost and activity are the highest. The visual below synthesized $3 Billion of payroll information, $155 Million of workers’ compensation premiums, and 5,613 claims. Countrywide our data aggregates more than $19 Billion of payroll information, $500 Million of workers’ compensation premiums, and 31,000 claims dating back to January 1 2008. It is not a myth that claims tend to cost more in both metropolitan cities as well as southern California.
RiskMD California Loss Study
RiskMD 4x Faster Than Bureaus
Every time our PEO clients run a payroll, our RiskMD heat maps refresh in real-time, and allow our clients to turn risk into reward. By understanding data, PEOs can evolve their workers’ compensation platforms into profit centers. RiskMD synthesizes our data 1.5 years faster than anyone else and an amazing 4 years faster than national and state bureaus. We can get in and out of areas of profitability and duress in a given class code, zip code, county, or state.
Risk MD Advantages for Making Your Workers Compensation Platform a Profit Center
The advantage to using RiskMD data is that we know where claims are going to be higher than average 3.5 years before bureau information is released. All of traditional workers’ compensation placements, which represent 92% of the market, do not know payroll and premium until post audit. Actuarial bureaus then get this information approximately 4-6 months thereafter and use it for rate making purposes approximately one year after that. As a result, the data used to promulgate workers’ compensation rates countrywide is from the years 2006-2010. The data you are seeing illuminated on this gauge is as of last Friday (5/2/2014).
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The PEO Compass is a friendly convergence of professionals and friends in the PEO industry sharing insights, ideas and intelligence to make us all better.
All writers specialize in Professional Employer Organization (PEO) business services such as Workers Compensation, Mergers & Acquisitions, Data Management, Employment Practices Liability (EPLI), Cyber Liability Insurance, Health Insurance, Occupational Accident Insurance, Business Insurance, Client Company, Casualty Insurance, Disability Insurance and more.
To contact a PEO expert, please visit Libertate Insurance Services, LLC and RiskMD.