How
can a self-insurance trust save me money?
As a participant in a self-insurance trust specifically designed for the members it serves, you benefit from the Trust's use of data specific to that industry. By this specialization, and by assisting participants with loss control and risk management based on claims statistics generated from that program, the Trust can assist participants in keeping losses low.
Without the overhead of large, multi-industry, multi-state organizations, the administrative costs are kept in check. In addition, each program is operated without the motive to "make a profit" -- rather, the Boards of Trustees from the industries served operate the programs with a keen eye toward expense control. This way each Trust can offer workers' compensation coverage for the industry at significantly reduced rates.
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Is
there a sponsoring group or association? Who are the Trustees?
Each of PRM's programs is sponsored by one or more organizations. ESTRA is co-sponsored by the Empire State Towing & Recovery Association and the Automotive Recycling Association of New York. The majority of Trustees in each program are member participants of the Trust. The Officers of each Trust are elected from the Trustees.
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What
are the qualifications for participating in the Trust?
To qualify for the Trust, participants must:
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May
I speak with participants in the Trust?
Please speak with any of the participants in the Trust program. All members of the Board of Trustees are open to talking to any
applicant who may be considering the Trust. Hear from them firsthand about the savings they receive through the program.
Please see the ESTRA/ARA-NY Trustees page for a list of trustees' names and telephone numbers.
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How
long has the Trust been in existence?
The ESTRA/ARA-NY Self-Insurance Trust began operations in May 1995.
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How
much can the Trust save me on coverage, and how is the contribution determined?
At the present time, every participant in the Trust is
realizing substantial savings compared to the conventional cost of coverage in New York State. The Trust utilizes the
New York Compensation Insurance Rating Board Experience Rating Plan to develop the Experience Modification
factor for each qualified participant. The Trust has years of experience on
which to base its rating structure to offer participants the lowest possible
cost without jeopardizing the strength of the program or participants' security.
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Who
is the Program Administrator? Does this organization have experience in
New York?
The Administrator of the Trust is Program Risk Management, Inc.
(PRM), an experienced company specializing in self-insurance programs in New York State. The President of PRM has worked with the Trust for more than
ten years, including two years in the development of their
first Trust to ensure its soundness prior to making it available to
participants.
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How
can you assure me that there won't be exorbitant rate increases after an initial
year or two of savings?
Each of the Trusts has several years of operating history, clearly indicating a consistent and prudent rating structure. The Trust's actuaries have worked with each program for its entire existence and are extremely familiar with its database and the operations of the specific industry. The actuaries conduct regular analyses of each Trust and make conservative short- and long-term projections to ensure an appropriate rating structure for the program.
The Trust also earns investment income on its assets, employs proactive loss control and claims management strategies, and continues to require strict underwriting criteria for participants.
The Trust does not add any fees or percentages for any reason, and all administrative costs are included in the rates.
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How
does the Trust minimize participants' risk?
There are strict criteria for participation in the Trust, which maintains low average Experience Modification through carefully established actuarial standards. Each participant is evaluated for financial stability, and bad risks are not accepted into the program.
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What
safeguards are in place to protect the Trust and my company? Does the Trust
purchase excess insurance and aggregate excess insurance?
By law, each Trust is required to purchase excess insurance. Any one accident above
$300,000 is covered by reinsurance up to the Statutory Limits of the Workers' Compensation Law.
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How
are medical claims handled? What safeguards are in place to assure that a
claim doesn't cost more than is necessary?
The Trust is known for processing claims quickly, thoroughly, and inexpensively.
Online claim reporting is available via our website; alternatively, the Trust has a toll-free telephone number participants can use to report claims (please see
our Contact Us page for all phone and fax numbers). Claims processors
can actually complete paperwork and C-2 forms for Trust participants!
The Trust also utilizes nurse care management on claims with more complicated medical issues, which can facilitate a more prompt return to work. Claims are processed efficiently, injured employees are encouraged to see physicians quickly, and the Trust works with participants to ensure employees receive proper treatment and can return to work as soon as possible.
In New York State, workers' compensation medical costs must be billed by physicians according to a set fee schedule. The Trust audits medical bills to ensure that no overpayments are made and that cases are settled correctly and fairly. The Trust also works to get injured employees back to work quickly once they've fully recovered or have become well enough to work in a modified position.
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If a claim is
suspected to be fraudulent, what can the Trust do? Can companies help
control costs by ensuring that only legitimate claims are paid?
Once participants join the Trust, they become actively involved.
Loss information is provided quarterly. Participants are provided with written updates and status reports on any claim reserved at
$25,000 or more. Participants are notified of Workers' Compensation Board hearings and are encouraged to send someone from the agency to attend. If participants suspect fraudulent claims, the Trust will investigate to the extent required in order to determine legitimacy. The Trust covers any costs incurred for surveillance or investigative activities and, by proactively combating fraud, saves money for individual agencies and for the entire Trust.
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Will my
coverage be cancelled or will I have to pay a surcharge if my loss
experience worsens?
A continuing evaluation of loss records and financial stability is conducted for the entire time an organization is covered by the Trust. If a participant's loss experience declines, loss control and claims management specialists will go to great lengths to work with
the participant to improve losses.
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Do I really
need workers' compensation coverage? What if we only contract with
independent contractors?
If your organization utilizes the services of individuals you consider "sub-contractors," the New York State Workers' Compensation Board will require evidence that they are protected by workers' compensation coverage to the same degree that your employees are protected. Consequently, when working with these individuals, you should obtain proof of workers' compensation coverage from them. If they are injured while working for you and are unable to provide evidence of coverage through another source, they may file a claim for workers' compensation benefits under your coverage. This can result in an audit of your workers' compensation payroll, and the cost of covering these individuals will be chargeable to your organization.
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