Influence of Property Within Workers' Comp Policy

[lsberrios1]

Hello,

Quick question. When an Insurance Co. underwrites a Workers' Compensation policy do they take into account the type of property for the rate?

For example, somebody works in a cellphone assembly plant. The building that houses the plant is made out of a very combustible construction material. One of the machines catches fire and the entire frame building goes down. I'd assume that is a massive catastrophe WC loss if employees were to be injured or killed.

This being said would they ask for a higher rate? I know they go by type of profession and medical costs by geographical location etc. but not sure if they take into consideration the environment they work in when it comes to physical property.

Thanks,
Luis

 

[AZDave]

WC underwriting looks at scope of work, experience mod and loss history with rates based purely on payroll, not the building or other hazards.

 

[lsberrios1]

WC underwriting looks at scope of work, experience mod and loss history with rates based purely on payroll, not the building or other hazards.

Understood. Shouldn't it though? It is a hazard risk for the employees after all.. I guess I am trying to reinvent the wheel. Thanks for your response.

 

[AZDave]

On larger accounts, carriers will go to the risk and perform loss control surveys. If apparent hazards exist, they will bring to insured's attention a require insured to take action.

 

[lsberrios1]

On larger accounts, carriers will go to the risk and perform loss control surveys. If apparent hazards exist, they will bring to insured's attention a require insured to take action.

Ok, this seems very reasonable from a time / cost perspective. Thank you Dave. That answers my question.