Understanding Dividend-Eligible Self-Insured Workers’ Compensation Programs

For any business or institution, managing financial resources effectively is crucial. One way to achieve this is through a dividend-eligible self-insured workers’ compensation program. This approach offers unique benefits and fosters a proactive risk management strategy, ultimately contributing to a safer and more financially secure environment.

What is a Dividend-Eligible Self-Insured Workers’ Compensation Program?

In a traditional workers’ compensation program, institutions pay premiums to an insurance carrier to cover the costs associated with employee work-related injuries and illnesses. However, a self-insured program allows schools and cultural institutions to assume the financial responsibility for these costs themselves.

Here’s where the “dividend-eligible” part comes in. By demonstrating exceptional safety practices and maintaining low claims experience, schools and institutions participating in a dividend-eligible program have the potential to receive a portion of their premium contributions back in the form of dividends.

The Value of a Dividend-Eligible Self-Insured Program for Independent Schools

Financial Advantages:

• Cost Savings: Participants have greater control over their workers’ compensation costs. By prioritizing safety and risk management, they can potentially reduce overall costs and benefit from dividend returns.
• Increased Transparency: Self-insured programs offer greater transparency into claim handling and loss prevention efforts, allowing members to identify areas for improvement and make informed financial decisions.

Beyond Finances:

• Enhanced Safety Culture: The ISCC incentivizes a proactive approach to safety, encouraging members to invest in risk management strategies, training programs, and creating a safer work environment for employees.
• Empowerment and Control: Members gain greater control over their workers’ compensation program, allowing them to tailor it to their specific needs and priorities.

Is a Self-Insured Program Right for Your Organization?

Choosing the right workers’ compensation program depends on various factors like organization size, claims history, and risk tolerance. However, a dividend-eligible self-insured program can be a valuable option for financially stable organizations committed to fostering a safe and healthy work environment.

Considering a self-insured program?

The Independent Schools Compensation Corporation (ISCC) can be a valuable resource. ISCC provides comprehensive risk management services, loss control, proactive claims management, and much more to members.

While ISCC dividends have historically been very strong, dividend returns are dependent on individual member performance each fund year and overall group performance. ISCC has averaged $4M in dividends annually over the last 5 years and when coupled with an aggressive 20% rate deviation, members enjoy approximately a 50% reduction in overall costs when compared to the commercial market.

Contact ISCC today to learn more about how a dividend-eligible self-insured program can benefit your school.