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Workers Compensation Large Deductibles & New SIGMA Resources

I spent some time this week outlining a concept for my PhD dissertation. It concerns the decision process related to selecting a workers compensation large deductible policy. I’m still a long ways from getting a formal proposal written, but I loved the brainstorming this effort created in the office this week.

If you work with workers compensation large deductible plans, I would like to hear your feedback. Below are some questions I am considering.  What do you think?

You can respond to these questions using two quick options. First, click here, and you will be linked to an online survey where you can respond. Second, if you prefer just to email me your thoughts, email TLC@SIGMAactuary.com.

1) When choosing between a guaranteed cost and a large deductible option, how often do most employers consider, as part of the decision process, an actuarially determined loss estimate of the retained losses associated with the large deductible?
2) As part of a more in-depth decision process, how often do employers consider a measure of the potential loss variability associated with the large deductible option? In other words, is a confidence interval analysis or some representation of the spread of risk considered in the decision?
3) In your opinion, how capable are decision makers (CFO/Risk Manager) at incorporating analytics that provide expected loss estimates and confidence interval analysis into their decision making process?
4) In a few sentences, where do you see the state of analytics as applied to the selection of a large deductible option?

All responses are strictly confidential. However, I will summarize, in a general format, the results and feedback and publish this in a future blog.

I believe, and hear it from a variety of industry contacts, that workers compensation large deductibles are going to be a significant area of growth in the months and years ahead. I will be providing more information, research, and ideas on this topic in this blog.

SIGMA Resources

On another topic, when we built our current www.SIGMAactuary.com web site, we utilized short video explanations on the home page. In speaking with some of our clients recently, I realized the availability of these videos is not obvious. So, we have started a YouTube channel and placed all the videos in one easily accessible location. You can find them at the links below:

Our channel: www.youtube.com/SIGMAactuary

Specific video topics (all short: 1 to 2 minutes in length)

Loss Portfolio Transfers
Sarbanes Oxley
Feasibility Studies
Budgeting and Cost Allocation
Confidence Interval Analysis
Cash Flow of Liabilities
Total Cost of Risk
Reserve Analysis
Program Retentions
Exposure Data
Loss Data
Loss Pick/Loss Projection

As always, please feel free to contact me directly at TLC@SIGMAactuary.com with questions or comments.

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Timothy L. Coomer, Ph.D.

About Timothy L. Coomer, Ph.D.

Dr. Coomer has a Bachelor of Engineering Degree with a double major in Mechanical Engineering and Mathematics from Vanderbilt University. He holds a Masters in Business Administration with a concentration in Finance from the Owen Graduate School of Management at Vanderbilt University and received his PhD from the Spears School of Business at Oklahoma State University. He founded Specific Software Solutions, LLC (1990) and developed the ModMaster Suite of software products. Dr. Coomer also co-founded SIGMA Actuarial Consulting Group, Inc. (1995). He presently serves as Chief Executive Officer of SIGMA and retired from Specific Software Solutions, LLC in 2010 after selling the business to Zywave, Inc. Dr. Coomer is now focusing on leading SIGMA’s RISK66.com effort along with traveling to meet brokers and clients around the country.

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Resources

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Questions? Contact SIGMA…

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