KY: “Joint and several” liability at work
A Circuit Court judge has ruled that members of the failed AIK Comp self-insurance group must pay millions in assessments to cover benefits for injured employees. We wrote about this matter in December, discussing the concept of joint and several liability and the so-called ‘long tail’ of workers comp claims. At that time the liabilities were in the $50 million range – the deficit is now more than $97 million, the expected costs to pay employee claims. Ouch. The moral of the story here is not to get in bed with a group of other employers unless the group has been carefully vetted for management practices of both the group administrator and the individual members.
OH: Another BWC official fired in Coingate
The chief investment officer of the state’s beleaguered Bureau of Workers Compensation was fired yesterday for poor performance in handling the $14 billion investment portfolio. The Bureau has been under scrutiny since a $50 million investment in rare coins came to light in April. About $13 million of that investment is “missing.” In all, about $300 million has been lost, much of the losses stemming from investment in controversial hedge funds. For a complete roundup of the evolving scandal see:
May 13: Ohio’s Great Workers Comp Coin Caper?
May 27: First Head Rolls in Ohio Coin Caper
August 23: Governor Taft’s Ethic Violations
CT: Broker probe results in $30 million settlement
Joe Paduda reports that another large broker – HRH (Hilb Rogal and Hobbs) – has agreed to pay $30 million to a compensation fund and a $250,000 fine in relation to rebating, account steering, and compensation practices in Connecticut. Joe notes that this hefty penalty is associated with one client in one state and wonders if there are other shoes to drop.
Joe has been a good watchdog on these matters. See also: Insurance Industry Scandal Watch
