The Power of Control in Self-Insured Workers’ Comp

We talked to twenty self-insured restaurant owners and asked them why they joined a self-insured group to insure their workers’ comp. Every one of them said “control.” Specifically, they said having control directly impacts their bottom line.

What Is Control and How Does It Impact Profitability?

Control is the foundation of successful workers’ compensation management. To understand its importance, let’s compare the level of control you have in traditional insurance versus the control you have in self-insurance.

In traditional insurance, you are left in the dark when it comes to managing claims. You typically have limited access to claims adjusters or attorneys, and you’re not part of the decision-making process. This means that someone else is making choices about how much to pay for your injured workers’ claims without consulting you. Imagine a scenario where you know a claim should be challenged, but you don’t even have a say, and the claim is paid out at a high cost, causing your rates to increase.

On the other hand, with self-insurance, you’re in control. When you are part of a self-insured group, you are an owner of the insurance company. You have direct access to your adjuster, legal counsel, and the board. You have a say in how your claims are handled. You can attend every deposition and trial, and your voice matters in the settlement process.

Why Is Control So Important?

The importance of control becomes evident when you consider how it directly influences your costs and, consequently, your profitability. Control empowers you to:

• Actively manage claims, preventing unnecessary expenses.
• Proactively mitigate risks by fostering a safe work environment.
• Secure a more predictable financial future, avoiding sudden cost spikes that can harm your restaurant’s profitability.

How Self-Insured Groups Provide Control

Now, let’s explore how self-insured groups (SIGs) give their members control. These groups are created by members for members, and their governance is in the hands of fellow restaurant owners. This setup ensures approachability and responsiveness, unlike traditional insurance companies.  Can you imagine trying to call the CEO of a commercial carrier?  Not only is that unheard of, the CEO doesn’t care about your claim.  The CEO cares about their shareholders. 

In a self-insured group, you have a voice. Here’s how CRMBC members experience greater control:

1. Approachable Governance: The board of trustees overseeing CRMBC consists of fellow restaurant owners. Any member can call them directly at any time. The board is responsive and approachable, a stark contrast to the distant hierarchy of traditional insurance companies.

2. Mutual Benefit Corporation: CRMBC is structured as a mutual benefit corporation, where members are the owners of the group. You have a say, you participate in board member elections, and you can directly engage with third-party administrators or the group’s administrators. You can even attend board meetings to voice your concerns and contribute to the decision-making process.

Conclusion

In the world of workers’ compensation, control is paramount. It directly influences your restaurant’s profitability. With self-insurance, you not only manage costs effectively but also foster a safer work environment, secure a predictable financial future, and actively influence your claims management.

Traditional insurance leaves you at the mercy of distant entities, with limited control and influence. In self-insured groups, the power is in your hands. You have a direct line to the board, the administrators, and the decision-making process. Your voice matters, and your control directly shapes the path to profitability.

Joining a self-insured group allows you to take the reins and proactively shape your restaurant’s financial future while keeping costs in check. Control is not just a buzzword; it’s your recipe for success in workers’ compensation.

In a SIG, you are not just a policyholder; you are a participant in the decision-making process, shaping your financial destiny.