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Hazardous Materials 12/31/13 Training Requirement

We are coming down the home stretch for the first round of (required) training on the new GHS Hazard Communication Program. The first round of training must be completed by December 31, 2013. For information on the new law, go to Alliance Health & Risk Service’s website at www.ahrsriskcontrol.com. Go to Safety Tips and Articles on the right upper side of the Home Page. The tab will take you directly to the PDF document that explains what you need to know.

The requirement for training participation is below!

California (Cal/OSHA) Hazard Communication Regulation (existing and new law) applies to:
A. All California employers – regardless of size – whose employees may be exposed to hazardous substances.
B. All hazardous substances found in the workplace under normal conditions of use as well as in reasonably foreseeable emergency conditions (i.e., a spill or release of a flammable chemical).

Proposition 65 applies to all businesses except:
• Companies employing fewer than ten employees
• Any government agency
• All public water systems

Proposition 65 applies only to:
The specified list of chemicals known to the State of California to cause cancer, birth defects, or other reproductive harm. These listed chemicals may be naturally occurring or synthetic, used as ingredients
in materials and products, and/or generated as byproducts, emissions, and waste.

What is Proposition 65
Proposition 65, or as it is commonly called, Prop 65, is the Safe Drinking Water and Toxic Enforcement Act of 1986. It is administered by the Office of Environmental Health Hazard Assessment, which is part of the California Environmental Protection Agency.

What does Prop 65 do
Prop 65 provides that persons doing business in the State of California may not expose individuals to chemicals known to cause cancer and/or reproductive toxicity without first giving clear and reasonable warning, nor discharge such chemicals into drinking water.

Prop 65 requires the State to publish a list of chemicals known to cause cancer or birth defects or reproductive harm. The list was first published in 1987 and is updated at least once a year. There are currently over 800 chemicals and substances on the list. The list of chemicals include both individual chemicals and categories of chemicals. The chemical may be present, for example, in common household products such as food, drugs, dyes, or solvents. Listed chemicals may also be used in manufacturing and construction, or they may be byproducts of chemical processes, such as motor vehicle exhaust.

WCIRB to Propose Regulatory and Rate Changes in Filing

San Francisco August 7, 2013 – Earlier today, the insurer and public members of the WCIRB Governing Committee voted unanimously to authorize the WCIRB to submit two filings to the California Department of Insurance (CDI). The first filing will contain proposed changes to the Insurance Commissioner’s January 1, 2014 and January 1, 2015 workers’ compensation regulations and will be submitted to the CDI on August 9, 2013. The second filing, which will be submitted to the CDI on or around August 19, 2013, will contain proposed January 1, 2014 advisory pure premium rates.

Traditionally, the WCIRB submitted a single filing containing proposed changes to both the regulations and advisory pure premium rates. This year, the CDI and the WCIRB developed a bifurcated filing process in order to allow insurers more time to modify their operational systems to reflect any approved regulatory changes.

Proposed Advisory Pure Premium Rates (to be submitted on or around August 19)

The proposed January 1, 2014 advisory pure premium rates that will be included in the WCIRB filing average approximately $2.62 per $100 of payroll, which is 3.4% above the industry average filed pure premium rate of $2.53 per $100 of payroll as of July 1, 2013.

These proposed advisory pure premium rates reflect the WCIRB’s most current evaluation of Senate Bill No. 863 (published October 12, 2012); however, these proposed advisory pure premium rates do not reflect any provision for the impact of the new physician medical fee schedule which is based on the Resource Based Relative Value Scale (RBRVS) and is under consideration by the Division of Workers’ Compensation (DWC). If the DWC adopts the new schedule, the WCIRB anticipates modifying its proposed advisory pure premium rates based on its evaluation of the cost impact of the new schedule on policy year 2014 medical costs.

Proposed Regulatory Changes (to be submitted on or around August 9)

The WCIRB’s August 9, 2013 regulatory filing will include proposed amendments to the California Workers’ Compensation Uniform Statistical Reporting Plan-1995 (USRP), the Miscellaneous Regulations for the Recording and Reporting of Data-1995 (Miscellaneous Regs) and the California Workers’ Compensation Experience Rating Plan-1995 (ERP) effective January 1, 2014. The amendments to the USRP include (1) changes to the Standard Classification System, (2) changes to data reporting requirements to conform to national data reporting specifications, and (3) an amendment to provide for the use of collective bargaining agreements to validate an employee’s hourly wage rate for purposes of assignment to a high wage dual classification for audits on policies with an expiration date on or after January 1, 2014. Additionally, a number of amendments will be proposed to the USRP, Miscellaneous Regs and the ERP to facilitate a bifurcated filing process and for clarity and consistency.

The WCIRB will also propose a number of regulatory changes to be effective on January 1, 2015 including amendments to the USRP pertaining to policy reporting requirements and significant amendments to the ERP intended to constrain the impact of a single claim incurred during the experience period to 25 percentage points.

Both filings and all related documents will be available in the Publications and Filings section of the WCIRB website (www.wcirb.com) and the WCIRB will issue a WCIRB Wire Story when each filing has been submitted to the CDI.

WCIRB to Propose Regulatory and Rate Changes in Filing

San Francisco August 7, 2013 – Earlier today, the insurer and public members of the WCIRB Governing Committee voted unanimously to authorize the WCIRB to submit two filings to the California Department of Insurance (CDI). The first filing will contain proposed changes to the Insurance Commissioner’s January 1, 2014 and January 1, 2015 workers’ compensation regulations and will be submitted to the CDI on August 9, 2013. The second filing, which will be submitted to the CDI on or around August 19, 2013, will contain proposed January 1, 2014 advisory pure premium rates.

Traditionally, the WCIRB submitted a single filing containing proposed changes to both the regulations and advisory pure premium rates. This year, the CDI and the WCIRB developed a bifurcated filing process in order to allow insurers more time to modify their operational systems to reflect any approved regulatory changes.

Proposed Advisory Pure Premium Rates (to be submitted on or around August 19)

The proposed January 1, 2014 advisory pure premium rates that will be included in the WCIRB filing average approximately $2.62 per $100 of payroll, which is 3.4% above the industry average filed pure premium rate of $2.53 per $100 of payroll as of July 1, 2013.

These proposed advisory pure premium rates reflect the WCIRB’s most current evaluation of Senate Bill No. 863 (published October 12, 2012); however, these proposed advisory pure premium rates do not reflect any provision for the impact of the new physician medical fee schedule which is based on the Resource Based Relative Value Scale (RBRVS) and is under consideration by the Division of Workers’ Compensation (DWC). If the DWC adopts the new schedule, the WCIRB anticipates modifying its proposed advisory pure premium rates based on its evaluation of the cost impact of the new schedule on policy year 2014 medical costs.

Proposed Regulatory Changes (to be submitted on or around August 9)

The WCIRB’s August 9, 2013 regulatory filing will include proposed amendments to the California Workers’ Compensation Uniform Statistical Reporting Plan-1995 (USRP), the Miscellaneous Regulations for the Recording and Reporting of Data-1995 (Miscellaneous Regs) and the California Workers’ Compensation Experience Rating Plan-1995 (ERP) effective January 1, 2014. The amendments to the USRP include (1) changes to the Standard Classification System, (2) changes to data reporting requirements to conform to national data reporting specifications, and (3) an amendment to provide for the use of collective bargaining agreements to validate an employee’s hourly wage rate for purposes of assignment to a high wage dual classification for audits on policies with an expiration date on or after January 1, 2014. Additionally, a number of amendments will be proposed to the USRP, Miscellaneous Regs and the ERP to facilitate a bifurcated filing process and for clarity and consistency.

The WCIRB will also propose a number of regulatory changes to be effective on January 1, 2015 including amendments to the USRP pertaining to policy reporting requirements and significant amendments to the ERP intended to constrain the impact of a single claim incurred during the experience period to 25 percentage points.

Both filings and all related documents will be available in the Publications and Filings section of the WCIRB website (www.wcirb.com) and the WCIRB will issue a WCIRB Wire Story when each filing has been submitted to the CDI.

Professional Liability Insurance Rates on the Rise

Insurance professionals expect management liability and professional lines rates to increase up to 10% in 2013 and are concerned with expanding regulatory and compliance costs, according to a survey by Torus Insurance Holdings Ltd.

Demand for media liability policies from small to medium-size companies to address social media exposures also is expected to increase, according to the Torus survey, which was conducted at the 25th annual Professional Liability Underwriting Society conference in Chicago this month.

Eighty-seven percent of the respondents, which included 105 risk managers, insurers, agents and brokers, expect management liability and professional lines pricing to increase in 2013, according to the survey.

Increases of up to 10% were predicted by 67% of the respondents, and nearly one in five said pricing will increase by more than 11%.

“Poor loss experience in major classes coupled with increased exposures is driving rate increases,” said Jeffrey Grange, senior vice president and head of professional lines at Torus, in a statement accompanying the survey results. “2013 will be a challenging environment where coverage, limits and pricing are all on the table and actively renegotiated at renewal.”

Concerns about Dodd-Frank, JOBS Act
Nearly half of the respondents – 49% – indicated that the Dodd-Frank Wall Street Reform and Consumer Protection Act will have the greatest impact on professional liability lines in the coming year.

Concerning the Jumpstart Our Business Startups Act, 49% of the respondents said reduced compliance and disclosure are the biggest exposures on the directors and officers market, followed by crowd funding at 21%, according to the survey.

“The regulatory environment continues to move away from companies and their directors and officers, with an ever-growing burden of compliance and disclosure especially in an age of heightened financial sensitivity,” said Craig Grant, vice president and U.S. head of private company management liability at Torus, in the statement.

Social media exposures increasing
For small to medium-size companies using social media, the scope of exposures are increasing, said Christopher Cooper, assistant vice president of media liability products, in the statement.

Among the respondents, 33% said data leakage was the biggest risk that small to medium-size companies must address when using social media, followed by control over potentially damaging content disseminated by employees at 27%.

Nearly three in five insurance professionals surveyed at the PLUS conference expect increases in demand for media liability coverage, according to the survey.

“An increasing number of respondents to this survey recognize the need for broader coverage – specifically media liability coverage – due to the potential risks small businesses face when introducing this medium into their business model,” Mr. Cooper said.

Happy Halloween from your friends at benchmark!

Tips to creating a safe and strong contract

A great first defense against claims and lawsuits is employing a strong service contract. Click the link below for some great advice on crafting a contract that keeps your company out of harm’s way.
10 Must-Have Contract Clauses

Cybersecurity Becoming #1 Concern for General Council and Directors

CLICK HERE FOR ARTICLE

WCIRB Releases Expenses and Losses Report

San Francisco, CA June 26, 2012 – The WCIRB has released its report on workers’ compensation losses and expenses for 2011. The report is prepared annually pursuant to Section 11759.1 of the California Insurance Code.

Among the findings included in the report:

Medical losses paid in 2011 were $4.4 billion, or 60% of total loss payments. Of these payments, $1.5 billion were paid to physicians for medical treatment, $1.1 billion were paid to hospitals, $1 billion were payments made directly to injured workers (mostly for future medical), $0.4 billion were paid to pharmacies, and $0.2 billion were paid for medical-legal reports.

The total cost of medical cost containment programs in 2011 was $384 million. This compared to $356 million in 2010 and only $197 million in 2005.

Indemnity benefits paid in 2011 were $3.0 billion, or 40% of total loss payments. Of this amount, temporary disability benefits paid totaled $1.5 billion and permanent partial disability benefits paid totaled $1.2 billion.

Total insurer losses incurred in calendar year 2011 were $7.7 billion, or 74% of calendar year premium. In calendar year 2010, total insurer losses incurred were $7.1 billion.

Total loss adjustment expenses incurred in calendar year 2011 were $2.6 billion, up from $1.9 billion in 2010. Both allocated and unallocated loss adjustment expenses increased sharply in 2011.

The combined loss and expense ratio for calendar year 2011 was 122%. In calendar year 2010, the combined loss and expense ratio was 117%.

To view a copy of the report, click the link below. WCIRB Expenses and Losses Report: 2011

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