New Conference Track Targets Operational Aspects

New NWCDC educational track to address risk financing, culture change and more.

By: Nancy Grover | March 7, 2014

The 23rd annual National Workers’ Compensation and Disability Conference® & Expo takes place Nov. 19-21 at the Mandalay Bay Resort and Casino in Las Vegas. The conference is produced by LRP Publications, which also publishes Risk & Insurance® magazine and the Workers’ Compensation Report newsletter.

Program Management is the name of the newest track of educational sessions to be included in the annual National Workers’ Compensation and Disability Conference® & Expo. This year’s conference will devote several sessions offering logistical operational pieces of the workers’ comp process.

“Topics will help employers improve their workers’ comp programs and operational practices,” said Roberto Ceniceros, senior editor for Risk & Insurance® magazine and conference cochair. “The discussions will give employers the ability to go back and make improvements in their programs that are going to get a positive response from the C-suite … for operating a program that reduces costs and returns employees back to work.”

An example of a topic in the new track would be risk financing. “Are there alternatives for employers financing their workers’ comp losses, and what are some better practices or strategies,” Ceniceros asked. “Strategy is a key word — what are better strategies to operate their programs?”

Whether employers want to continue purchasing workers’ comp insurance and, if so, whether a large deductible is a good option, is among potential discussion points. Some companies may want to consider self-insuring or gaining from captive programs. Potential questions to be explored by employers are whether to bundle or unbundle their claims services.

Other issues employers may be interested in concern cultural changes, “changes you can make in your company to help address claims outcomes,” Ceniceros said.

Additional topics being considered for the Program Management track include:

Vendor management — what are the best strategies to manage vendors that will help reduce costs.
High-level safety/loss control. For example, how employers with many traveling employees can prevent driving injuries. The use of behavioral safety training may come into play.
Structuring a workers’ comp program.
Managing the request-for-proposal process to achieve better outcomes.
Provider performance — ranking medical providers by using outcome metrics for measurably better results.
Collateral issues.

“These are operational innovations that target employers,” said Mark Walls, conference program cochair, senior vice president of workers’ compensation market research leader at Marsh USA, and founder/manager of the WorkCompAnalysis group on LinkedIn.

In all, more than 30 breakout sessions will be presented during the three-day conference. Other tracks include Claims Solutions, Health/Medical Management, Disability Management Solutions, and Legal/Regulatory Issues.

Claims Solutions

Workers’ comp experts and employers will team up to offer best practices to improve outcomes. Some of the topics being considered for this track include:

Strategies for closing claims and reducing legacy claims.
Identifying key issues to settle claims.
The multiple prongs of fraud.
Claims adjusters — what they need from employers.

Health/Medical Management

“Managing future medical drivers is key,” said Denise Gillen-Algire, principal of Risk Navigation Group and conference program cochair. “Innovations in medical management such as medical procedures, drugs, and other issues that are driving up costs” are among the topics she sees as important to address.

Disability Management Solutions

Building on last year’s success, the 2014 conference will include expanded offerings. Integrated disability management is among the main topics that will likely be addressed. Additional topics under consideration include:

Pre-loss/post loss tie ins. For example, how some employers are using post-offer medical exams to better manage their workers’ comp claims.
The impact of return-to-work efforts on safety prevention.
Provider strategies/pay for performance and how some companies are operationalizing it.

Legal/Regulatory Issues

Once again, the National Workers’ Compensation and Disability Conference® is partnering with LexisNexis to design sessions focused on legal elements of the workers’ comp system. Among the potential topics are:

Asbestos/mesothelioma. While this has been a liability issue, these policies are tapped out, and some attorneys are now looking to the workers’ comp system. Recently, Missouri passed legislation, while the Pennsylvania Supreme Court rendered a decision making it likely these two states will be the first to see these type of cases. Conference organizers believe this may be an important trend employers should watch.

Medicare set-asides. Changes from the Strengthening Medicare and Repaying Taxpayers Act, or SMART Act, has made Medicare Secondary Payer issues “messy,” Walls said. Conference organizers are working with LexisNexis to develop a session that addresses the very latest challenges on the topic.

For more information, visit the conference website at www.wcconference.com. Details on specific sessions will be available in mid-2014. To read and/or post your thoughts about the conference, visit LinkedIn, and type National Workers Compensation and Disability Conference & Expo in the search box.

Nancy Grover is the president of NMG Consulting and the Editor of Workers' Compensation Report, a publication of our parent company, LRP Publications. She can be reached at [email protected].

How a Carrier Partner Can Help Navigate a Challenging Management and Professional Liability Market

A combination of a choppy economy with increased claims frequency and severity could lead to rate increases in the Management & Professional Liability market.

By: Risk & Insurance | April 3, 2024

Rates in the management & professional liability (M&PL) markets were on the rise from 2020 to early 2023 and are now falling rapidly.

M&PL divisions manage a number of different insurance products including management liability (D&O), professional liability (E&O), employment practices liability (EPL), fiduciary liability policies, cyber, etc. In 2023 and into 2024, a big influence on the marketplace has been the extremely aggressive and softening public company D&O market.

Though these rates have been softening for management liability, that may change over the next few years as companies continue to adjust their business models motivated by economic uncertainty. Layoffs were up nearly 200% last year, Forbes reported, even as other recession indicators, like the inflation rate, improved. A recession could lead to an increased claim activity and force carriers to raise rates.

“Whenever there is a meaningful downturn in the economy, we tend to see claim frequency pop up,” said George Schalick, Jr., senior vice president of the Management and Professional Liability Division at Philadelphia Insurance Companies (PHLY).

With continued fiscal uncertainty, businesses potentially already burdened with pandemic-related claims should seek a carrier with a long history in M&PL products. They will provide much-needed risk management guidance and be better positioned to support their insureds during market fluctuations.

Why Insureds Might See an Uptick in M&PL Claims

George Schalick, Jr., Senior Vice President of the Management and Professional Liability Division, Philadelphia Insurance Companies

The current soft market might come as a bit of a surprise as it does not track with previous underwriting cycles and economic conditions. Afterall, many privately held and non-profit organizations struggled during the early days of the pandemic with shutdowns and rapidly declining revenues. But the Government assistance programs, like the Paycheck Protection Program loans, helped keep many afloat during the tough times.

“During COVID many organizations stopped doing business until they were able to sort out all of the health and safety challenges,” Schalick said. “They were forced to lock down, but then all the government assistance programs allowed them to keep people employed. The increased volume of claims we anticipated we would see coming from the lockdowns and restrictions that were imposed upon businesses in the U.S. didn’t manifest at first.”

“Just because there wasn’t an onslaught of reported claims at the beginning of the pandemic, doesn’t mean the circumstances that would give rise to a claim being reported didn’t occur. Courts and the judicial system were closed or slowed and now that they are back open, we’re starting to see the circumstances that occurred during the COVID lockdowns becoming claims today,” Schalick said. “Litigation is progressing.”

Added to the delayed pandemic litigation is a concern over newer claims that might be filed as the country inches toward an economic downturn. Though a recession was avoided in 2023, experts think a soft dip could occur in 2024, with 76% of economists saying there’s a 50% or less chance of an economic downturn this year — that almost always results in more management liability claims.

“During the Great Recession in 2008, we saw an almost immediate spike in claims because of the economic conditions and the pressure it placed on organizations. They were making personnel changes with significant belt tightening almost immediately.” Schalick said.

What’s in Store for M&PL Policy Rates in 2024?

Despite an uptick in claims and increased economic uncertainty, management liability rates haven’t increased, resulting in market-wide pricing levels that may not meet the increased pressure of rising settlements and jury verdicts.

“Rates are going the other direction and settlement values are not falling,” Schalick said.

The mismatch between rates, claim frequency and severity is, in part, because carriers experiencing the dramatic soft market in the public D&O market are seeking premium gain in the private and non-profit market.

“In the public company market, the rates have been decreasing significantly. The rates were increasing in the private, not-for-profit market, and rightfully so, but there’s a desire to supplement overall mid-size D&O for carriers who also write private not-for-profit, and they see that as an opportunity to aggregate premium,” Schalick said. “So the always competitive landscape in the private, not-for-profit market has dramatically increased in the last 18 to 24 months.”

Still, companies of all sizes and types should be concerned about management liability rates in the future. Legal system abuse is resulting in increases in both the amount of litigation and the size of verdicts plaintiffs are receiving.

Certain areas of the country are particularly vulnerable to this type of legal system abuse. As a result, insureds in these localities are likely to be vulnerable to rate increases.

“The environment is so positive for the plaintiff that forces premium increases so carriers are able to stay in that market long term,” Schalick said.

Why a Tenured Carrier Partner Can Help Insureds Navigate An Uncertain Market

It’s clear that insureds are facing an uncertain M&PL market over the next few years. Fortunately, carriers with a long history in the M&PL space will be there to offer stability.

Philadelphia Insurance Companies has been supporting this market for 35 years. PHLY is committed to offering long-term rate stability, even as economic and claims trends start to push premiums upwards. They have an appetite for all sorts of companies, large and small, for-profit and nonprofit alike.

“We’ve been at this game for a long time and are one of the most tenured underwriters in this space,” Schalick said. “We like to stay very consistent.”

PHLY has worked with both for-profit and non-profit on management liability policies. With dedicated M&PL teams throughout the company’s 13 regions, PHLY provides the support agents and brokers are looking for on behalf of their clients. The teams know their regions well and can respond to local trends. They’re also dedicated to making the renewal process as easy as possible for their partners and policyholders.

“We have real confidence in our results, so we focus a lot on making the renewal experience as painless as possible for all agents and insureds,” Schalick said.

The company is also investing in tools to help insureds avoid losses. Earlier this year, they launched a new online risk management platform, PHLYGateway, which offers resources for insureds on how to create an employee handbook and trainings on issues such as recognizing workplace sexual harassment and discrimination.

If insureds have questions, they can consult a Best Practices Help Line, provided via the platform. That way, they can get on the spot risk management guidance to help them prevent claims.

To learn more, visit: https://www.phly.com/mplDivision/managementLiability/default.aspx.

This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with Philadelphia Insurance Companies. The editorial staff of Risk & Insurance had no role in its preparation.

Conference Tracks Announced