The Ohio BWC is continuing their trend of lowering workers’ compensation costs for Ohio’s private employers. In July, a 20 percent cut for private employers took effect and this will be followed by another $1.5 billion of the agency’s revenues being given back to Ohio employers covered by the BWC system.
The latest rate cut, which will save Ohio’s private employers more than $200 million, is the largest rate cut in nearly 60 years.
The $1.5 billion dividend equals 88 percent of the premiums employers paid for the policy year that ended June 30, 2018 (calendar year 2017 for public employers). While the bulk would go to private companies, an estimated $114 million would go to counties, cities, townships and other local government entities. Nearly $50 million would go to public school districts.
BWC will begin sending dividend checks to employers in late September.
This dividend marks the fifth time since 2013 the agency has returned at least $1 billion to employers following strong investment returns, falling injury claims and other operational efficiencies.
Employers are free to spend the funds as they wish, but BWC Administrator/CEO Stephanie McCloud urges businesses to invest in workplace safety.
In total, BWC has saved employers nearly $10 billion in workers’ comp costs through dividends, credits, rate reductions and greater efficiencies since 2011.
Overall, the average rate levels for the 242,000 Ohio employers in the BWC system are at their lowest in at least 40 years.
OIA's Judy Sivy, Chief Revenue Officer, answers questions regarding the disaffiliation from PIA, and how it affects your E&O coverage.
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The Ohio Department of Insurance (ODI) recently issued Bulletin 2019-05 which provides guidance to insurance agents who wish to give promotional or advertising items to potential insureds or insureds in exchange for the opportunity to market insurance products. This bulletin supersedes, replaces and rescinds Bulletin 2009-13 which was issued in 2009 by then ODI Superintendent Mary Jo Hudson.
While the content of the updated bulletin is relatively the same as it had been in past years which generally provides that ODI does not interpret the offering of promotional and advertising items, or meals to be an unfair inducement provided the item does not exceed $50 and is not tied to the purchase of an insurance product, it does provide significant clarification for agents who want to hold contests, raffles and drawings.
The updated bulletin contains language to address contests, raffles and drawings that involve a prize in excess of $50. The bulletin clarifies that as long as the raffle or drawing is open to the general public where all participants are given a free chance to win, so long as it is not tied to the sale or solicitation of insurance and no purchase or renewal of insurance is required to enter, win, or claim the prize, it is not considered an unlawful solicitation or promotion even if the gift exceeds $50 in value. Bottomline: you can hold a contest, raffle or drawing with a prize that is worth more than $50 as long as it is open to everyone and participation is not contingent on the person obtaining a quote or purchasing or renewing a policy.
OIA routinely receives questions about rebating and inducements. If you have questions, contact Carolyn Mangas at email@example.com.
The Ohio Insurance Agents Association, Inc. (OIA) provides this information with the express understanding that 1) no attorney-client relationship exists, 2) neither OIA nor its attorneys are engaged in providing legal advice and 3) that the information is of a general character. You should not rely on this information when dealing with personal or professional legal matters; rather, seek legal advice from retained legal counsel.
The Big “I” and ACORD, the global standards-setting body for the insurance industry, have announced a joint program to provide qualifying Big “I” members with a complimentary license to use ACORD Forms.
ACORD, a nonprofit industry organization, has provided forms to the insurance industry since 1972. ACORD currently maintains a library of over 850 forms in a variety of formats, widely used throughout the global industry. As part of its ongoing collaboration with ACORD, the Big “I” will now fund ACORD Form end user licenses for the majority of member agencies, enabling them to claim these licenses free of charge.
“Industry-standard forms are a critical component of an independent agent’s business,” says Bob Rusbuldt, Big “I” president & CEO. “With this licensing program, the Big ‘I’ is helping our members improve their operational effectiveness. We are proud to play a key role in facilitating the delivery of these assets to our members and to further enhance the value of their Big ‘I’ membership."
All agents and brokers using ACORD Forms are required to obtain licenses from ACORD. Users who are not already members or subscribers of a qualifying ACORD program are able to purchase a standalone End User License from ACORD. Under this agreement, Big “I” members with a group gross revenue of under $50 million will be eligible for a license from ACORD due to their Big “I” membership, with no additional payment necessary. Agents will still access forms via their agency management system workflow as they have previously.
“The Big ‘I’ has been an invaluable partner to ACORD in standards development, industry outreach, and many other activities in service to the insurance industry at large,” says Bill Pieroni, ACORD president & CEO. “By ensuring access to ACORD Forms, the Big ‘I’ has once again affirmed its commitment to enabling success for the independent agent and broker community.”
This article was originally written by Katie Butler, IA editor in chief, and published on IAmagazine.com.
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The program that has been administered by the Ohio Bureau of Motor Vehicles (BMV) since 1998 to randomly check to ensure that Ohioans are complying with the state’s financial responsibility laws has ended. Effective July 3, 2019, the BMV will no longer require proof of financial responsibility through a random selection verification process.
Earlier this year, language to eliminate the program was inserted by the Senate Transportation Committee to the state transportation budget to eliminate the verification program. This program had been a target for elimination by some legislators for years as it became increasingly ineffective at catching uninsured drivers, and thus was viewed by some as burdening responsible drivers who comply with the law.
OIA is the only organization that weighed in on the elimination of this program. In our testimony, we emphasized that the last Financial Responsibility Study Committee Report issued in 2014 recommended REPLACING the BMV’s random selection program – not simply eliminating it. Furthermore, we made clear that we do have concerns about not replacing this program with a more robust auto insurance verification system that capitalizes on the technological advances that have become available in the last several years. To date, an effort to do so has yet to get underway, yet more than half of the states have passed laws and begun to develop and implement online auto insurance verification systems to identify uninsured motorists.
WHAT CHECKS REMAIN?
With the elimination of this program, the checks that remain for financial responsibility include traffic stops and individuals affirming that they have proper financial responsibility when they apply for a permit/license or they register a vehicle.
IMPACT ON YOUR CLIENTS
According to the BMV, Ohioans with random selection suspensions prior to July 3, 2019, will still be required to provide proof of insurance or comply with the reinstatement requirements. In order to cancel a random selection suspension, the individual must provide proof of liability insurance coverage listing the selected vehicle in effect for the requested verification date. The individual may submit a copy of his or her automobile insurance policy declarations page, insurance identification card or a letter on insurance company letterhead and signed by the agent indicating liability insurance was in effect.
QUESTIONS OR COMMENTS?
Contact Carolyn Mangas, OIA’s Government Affairs Manager, at firstname.lastname@example.org.
Also see: Ohio BMV’s Financial Responsibility Random Verification Program Eliminated