Maryland’s Chesapeake to Phase in NCCI Rates in 2020
Chesapeake Employers’ Insurance Company, Maryland’s largest writer of workers’ compensation insurance, announced its plan to phase in the National Council on Compensation Insurance’s (NCCI) rating methodology and other changes as required by state legislation enacted in 2015.
Chesapeake Employers CEO Tom Phelan said S.B. 465 will make several changes to the company, which will occur over the next several years. Phelan announced the plan in a March 28 customer update letter.
Phelan said that when all steps as outlined in the legislation are completed, Chesapeake Employers will be just like any other mono-line carrier, with two exceptions: it will continue to be the workers’ comp guaranteed market writer in Maryland; and two of the nine Board members will be appointed by the governor.
The legislation mandates that Chesapeake Employers must join the NCCI and adopt their rating methodology, their experience modification calculation, scheduled rating and file rates with the Maryland Insurance Administration, effective Jan. 1 2023. Chesapeake Employers plans to begin the phase-in process in 2020.
Phelan said this will be a controlled phase-in from the current Chesapeake Employers’ rates and individual experience modifications or e-mods to the new NCCI-based rates and their e-mod calculations.
“We plan a very orderly transition with minimal changes occurring each year,” he said. “Please be assured that our goal in this process is to minimize any negative impact on our policyholders.”
In addition, Chesapeake Employers will be able to write workers’ comp in other states starting in 2022. “Initially we will explore the possibility of writing business in Virginia and the District of Columbia,” Phelan said.
Chesapeake Employers, formerly known as Injured Workers’ Insurance Fund (IWIF), transitioned from a state-run workers’ comp carrier to a private, nonprofit company in 2013. It has served as a continuous, guaranteed source for workers’ comp insurance in Maryland since 1914.