How does the workers' compensation system operate in Washington State?
The Washington Workers’ Comp insurance system was established in 1911 and was set up as an “exclusive remedy” insurance system, which protects employers from being sued by employees who are injured on the job. The Washington Workers’ Compensation system includes coverage for industrial injury claims and occupational disease claims. Employees who are injured on the job and are found to have a valid claim are eligible for payment of medical benefits and, if appropriate, wage replacement benefits for time missed from work.
How is claim validity proven?
Washington is a “no-fault state” meaning that a worker will have coverage despite the actions that led to the injury. The worker simply needs to be in the course of employment to have an accepted injury claim. Occupational disease claims, typically for conditions that develop over time, are allowed simply if the condition arises “naturally and proximately out of employment.” Vigilant claims managers are experts at identifying occupational disease claims and, when possible, removing a significant portion of the costs from the current employer.
Washington workers’ comp law allows employees one year to file an injury claim, and occupational disease claims must be filed within two years of the date a worker received written notice from a provider that the condition exists.
Which insurance options are available?
As one of four monopolistic states, there is no option for private workers’ comp insurance in Washington.
There are four avenues for insuring your workers in Washington State. Some large employers may choose to self-insure if strict loss history and financial criteria are met. All three remaining options are purchased through the department of Labor and Industries (L&I):
- General Fund – Employers pay premiums to L&I based on statewide rates. In the general fund, there is no opportunity to earn any portion of your premium back from L&I.
- Individual Retrospective Rating Program – Individual employers pay premium to L&I as they would if participating in the general fund. L&I then performs a “look back” at three periods after the plan year has closed and determines the premium that should have been owed in the plan year. If losses for the employer are lower than the premium paid, L&I issues a refund of the unneeded premium. If, however, losses exceed the premium paid L&I will issue an assessment, holding the company financially responsible for all underpaid premium.
- Group Retrospective Rating Program – the same tenants of an individual retro apply here with the added protection of being surrounded by other companies. This insulates any one employer from the risk of an assessment and increases the opportunities for large refunds. Vigilant has sponsored a group retro program since 1984 and has never been issued an assessment from L&I. Learn more about Vigilant’s Retro program.