Excess Insurance Issues (California)

[suekarp]

I would like to know how many self Insured folks have encountered situations where the excess carrier is making excessive or unreasonable demands before they will make any payments to the self-insureds?

I have encountered thisngs like a requirement to provide a list of all medications provided to the injured worker from day one, or attempting to changing of a CT injury date to put the excess carrier out of the exposure period, even though there are stips approved by the WCAB which establish the end date of the CT, and it is within their policy period?

What other things have you encountered that seem to be calculated to delay/deny payments.

What have you done about it?

[50Cal20]

Here is my list of typical delays or denials I have seen from excess insurance companies:
1. Refusal to reimburse expenditures for self-insured employer's failure to timely place them on notice of claim, even when there is not prejudice.
2. The excess insurance claims adjuster arbitrarily and unilaterally establishes a reduction of reimbursement (i.e., 50% reduction) for any reporting violation, including lack of supporting evidence.
3. Refusal to reimburse for failure to conduct utilization review even, if the services were obviously warranted.
4. Refusal to reimburse when the self-insured administrator overrides a UR decision and provided services, where in the long run money is saved (i.e., override UR and authorized x-rays that cost $100 rather than incur a $500 expense of going to an AME).
5. Refusing to contribute towards the cost of a structured settlement that buys out the excess insurer's liability. Example: Employee is entitled to $150,000 in PD of which $20,000 pierces the excess insurance level. However, the cost to voluntarily fund a structured settlement that pays $150,000 is only $120,000 resulting in a $10,000 savings to the employer and a $20,000 savings to the excess carrier. Yet the excess carrier refuses to contribute because the retention cap was not met.

The easiest way to resolve all these issues, as well as others, is to have a written agreement beforehand added to the insurance policy addressing these issues.

[suekarp]

It is very unfortunate that the policies that are putting up such huge roadblocks are ones where the covereage was in the mid-late 1990s, and they did not anticipate things such as UR, or any other things of that nature.

Please email me as I would like to know who you are.

[tony.su3@comcast.net]

I have been seeing this issue develop over the last few years with multiple clients. Excess carriers have been pushing the insured to open or re-open claims and move payments to other cases in an effort to stick them with multiple retentions or to shift the exposures to a different policy/carrier. In one case (the underlying case was settled) the excess reimbursement was being withheld by the carrier on the premise that medical treatment had to be moved to a prior claim in the same proportion as the PD allocation. We came to an agreement with the carrier that we would submit the issue to a physician for review and both parties would abide by the doctor's determination. The opinion was that the medical treatment was all due to the excess injury and none of the treatment costs were associated with the prior minor injury case despite the allocation of some PD to that claim by a prior QME. We ended up getting the full reimbursement was was well into 6 figures by that time. Carrier are becoming more and more aggressive and I'm now seeing attempts to force administrators to set-up additional claims if there is even a mention of a potential CT in the medical reports even when an AA has not filed an application.