By Mannix Porterfield
West Virginia beckons as the “New Frontier” in workers’ compensation insurance coverage.
Once the doors formally opened July 1, a floodtide of outside carriers jumped through the necessary hoops with the West Virginia Insurance Commission to legally qualify to compete for compensation insurance.
Until that date, BrickStreet has enjoyed a monopoly, ever since the state Legislature, approving a proposal by Gov. Joe Manchin, dismantled the state-run, debt-ridden system and turned it over to private enterprise.
Among the 171 new players are some of the more recognizable names in the industry — AIG, Erie, Hartford, Liberty and Travelers.
“You’ve got an open frontier,” Jason Butcher, communications specialist for the insurance commission, said Tuesday.
“Kind of like back in the old days before the West was settled. You had all that out there for the taking. You’ve got one company that’s been providing business, and it opens up.”
Butcher couldn’t say just how many of the 171 ultimately will be writing workers’ compensation folders for West Virginia firms.
“These are companies that have just said they want the ability to come in and write,” he said.
Nor could he speculate if there’s enough business to spread around, if all 171 attempted to write policies.
“I’m sure that companies are sitting back and seeing what happens and going from there,” Butcher said.
“I do know, for fact, there have been other companies even as early as July 1 that wrote insurance policies.”
Butcher couldn’t say exactly how many outside carriers are actually in business in West Virginia, explaining they are tracked through a proof of coverage system, which is updated at the end of each month.
In an interview last month, Greg Burton, the chief executive officer for first-in-the-field BrickStreet, said he welcomed the challenge of rival companies, making their debut after the first private company has been operating without competition since 2005.
“We know the workers’ compensation market better than anyone coming into the market place,” Burton had said.
Butcher said the arrival of competing firms will benefit business owners and employees alike.
“Competition is good,” he said.
“One of the big criteria for taking folks on is claims handling — how well companies getting insurance handle claims and how well they treat their injured workers.”
Another major plus is that premiums become competitive, as more firms begin to jockey for business.
“It’s just like shopping for your car insurance,” Butcher said.
Is there room in West Virginia for 171 companies to sell insurance?
“It’s still yet to be seen,” Butcher said.
“Just because there are 171 companies that have said they are interested and would like to have the ability to come into West Virginia and write insurance doesn’t necessarily mean they’re going to come. It doesn’t mean they’re going to do it. They just wanted the ability to do so. But even as early as the first of July, there were folks that switched over.”
