Worker's Comp Industry Lingo
Empower yourself with the language of insiders. We decipher the arcane terms, epigrammatic abbreviations, and weird words used in the industry.
- Adjuster - A person who investigates and settles losses for an insurance company. In a workers' compensation case, an adjuster would do evaluations to determine when the injured would be able to return to work. Also known as an "administrator" and "claims examiner."
- Applicant - The person or group that opens a case by filing an application for adjudication of claim.
- Apportionment - The means of determining the level of permanent disability due to a work injury and how much is due to preexisting conditions and disabilities.
- Audit - A confirmation of a company's finances that allows an insurance agency to set fair premiums, as well as expose any discrepancies which may be affecting premiums. Your business will undergo yearly audits to determine if your workers' compensation premium is correct.
- Claim - A request filed by the insured to the insurance company to be reimbursed for a loss. With workers' compensation, a claim for reimbursement would be filed if an employee is injured on the job.
- Coverage - The extent of what your insurance policy will cover in case of any accident or need for reimbursement.
- Cumulative injury (CT): Injury that resulted from repeated events or exposures within a work environment. Repetitive stress injuries would be one example.
- Death benefits: Benefits paid to surviving dependents after the death of a worker due to job-related injury or illness.
- Employee Liability Coverage - Often included as part of a workers' compensation insurance policy. It is meant to protect an employer if an employee files a lawsuit because of an injury or sickness incurred while on the job.
- Experience Modification Factor - The experience modification factor is just one of the many ratings and factors that go into the calculation of your worker's comp premiums. This rating is based on your entire history of claims. When purchasing insurance for the first time, this rating won't be considered (simply because you don't have a history of claims at this point).
- Family and Medical Leave Act (FMLA): Federal law that provides up to 12 weeks of unpaid, job-protected leave each year to qualifying employees that have major health problems, as well as those needing to care for a child or family member. The law further requires all health benefits remain intact for the duration of the leave. For more information, see the FMLA requirements published by the U.S. Department of Labor.
- NCCI - National Council on Compensation Insurance. A bureau that calculates rates for workers' compensation insurance premiums. They use over 600 industry classifications to calculate these rates.
- Permanent disability (PD): A lasting disability resulting in an individual's reduced earning capacity, even after all medical treatment and rehabilitation has taken place.
- Permanent disability rating (PDR): The estimated percentage of how much a job injury has permanently limited the kinds of work an individual can perform. Figure is based on the worker's medical condition, date of injury, age (when injured), occupation (when injured), extent of disability caused by the job, and the diminished future earning capacity. These factors are used to calculate the total number of weeks for permanent disability benefits.
- Policy - The plan you receive for your business through your insurance agency. It's a legal document that details all the terms and conditions of your insurance coverage.
- Premium - A sum paid for an insurance policy by the policyholder. Usually arranged in monthly, or annual increments. With workers' compensation insurance, the employer pays the entire premium. There isn't any employee contribution, as with other benefits.
- Work restrictions: Doctor's detailed explanation of the work an individual can and cannot perform, in order to prevent further injury.
- Workers' Compensation Insurance - Insurance held by companies to reimburse employees that get sick or injured on the job. Workers' compensation is a state-mandated program.