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Frequently Asked Questions
- What is the WCRA?
- Is the WCRA a state agency?
- What is a retention limit?
- Under what circumstances is a member required to report a claim to the WCRA?
- Does the WCRA provide coverage on a per-occurrence or per-employee basis?
- How does a member know what retention limits are valid for which years?
- How does a member determine which retention limit applies to a claim?
- When and how does a member submit reimbursement requests on a claim?
- Does a member need to notify the WCRA before it settles a claim?
- Will the WCRA participate in a settlement below the retention limit?
- Why does the WCRA need prior year's payroll information for new members?
- How is the exposure base determined?
- How is the premium calculated?
- Does the WCRA make a profit?
- Can a member purchase other reinsurance coverage?
- What types of reports or statistical information can a member obtain from the WCRA?
- Why does an insurer have to be a member of WCRA if it doesn't write workers' compensation and doesn't plan to in the future?
- What does the 1.2 adjustment factor in the exposure base represent?
- Does the 1.2 adjustment factor in the exposure base raise members' premiums?
- Does the WCRA charge late fees for late premium payments?
- Does the WCRA provide employer's liability, federal coverage, or any other types of insurance other than workers' compensation?
- I'm preparing my company's Annual Statement, Schedule F. What is the WCRA's NAIC pool number? Federal Employer Identification Number?
What is the WCRA?
The Workers' Compensation Reinsurance Association was established by Minnesota statute in 1979 to respond to a need for reinsurance protection for serious workers' compensation claims. The association's membership consists of companies and governmental subdivisions authorized to insure their own workers' compensation ("self-insurers"), and insurance companies authorized to write workers' compensation insurance ("insurers"). All Minnesota entities fitting those definitions are required by law to be WCRA members.
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Is the WCRA a state agency?
No. The WCRA is a "quasi"-governmental organization that was established by the State Legislature and is regulated by the Department of Labor and Industry.
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What is a retention limit?
A retention limit is similar to an insurance deductible dollar amount. The association reimburses members for all statutory workers' compensation loss payments in excess of the chosen deductible or retention limit. To view the retention limits click here.
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Under what circumstances is a member required to report a claim to the WCRA?
The WCRA has established reporting criteria designed to alert the WCRA to claims that are likely to involve losses above the member's retention limit. One significant reporting criterion requires members to report claims in which claims payments plus reserves exceed half of the chosen retention limit. For a complete discussion of reporting criteria, see Initial Claims Reporting in the Claims Reference Guide.
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Does the WCRA provide coverage on a per-occurrence or per-employee basis?
Per-occurrence. There is, however, a distinction between a multi-claimant loss and an occupational disease claim. In the first case, one incident results in injuries to more than one employee, and one retention limit applies to the occurrence, which is treated as a single claim. Occupational disease, in contrast, is considered a separate occurrence for each affected employee, and the limit applies to each employee separately. Refer to "Per-Occurrence Coverage" in the Claims Reference Guide for more information. More information on this topic can be found in the Member's Reference Guide.
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How does a member know what retention limits are valid for which years?
Members select a retention limit, with a corresponding premium rate, for each calendar year. Every autumn the WCRA informs members of the retention limits available in the upcoming year. For an historical list of retention limits click here.
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How does a member determine which retention limit applies to a claim?
The retention limit in effect for the year in which the employee's injury occurs applies, regardless of when the claim is filed with the WCRA. Click here to download a chart of retention limits.
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When and how does a member submit reimbursement requests on a claim?
An initial or interim request may be submitted any time during the two eligible months of the reimbursement cycle that the member has selected (anniversary date or six-month cycle). Various documents must be submitted with each request. For details, refer to Reimbursement Request Procedures in the Claims Reference Guide.
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Does a member need to notify the WCRA before it settles a claim?
Yes, the member should contact the WCRA claims services staff before making a settlement that will involve association funds. While the member is not required to get the WCRA's approval, this allows the association an opportunity to provide input that will protect the interests of its overall membership.
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Will the WCRA participate in a settlement below the retention limit?
No. The retention limit defines the level at which the WCRA begins to make reimbursements.
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Why does the WCRA need prior year's payroll information for new members?
This information allows the WCRA to calculate and bill estimated premiums for the upcoming coverage period. If the estimated premium differs from the actual premium incurred, the difference is billed or credited the following July.
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How is the exposure base determined?
For self-insurer members, the exposure base is the modified adjusted pure premium. For insurer members, the exposure base is the adjusted pure premium. See Member Exposure for more information. Complete details on this topic can be found in the Member's Reference Guide.
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How is the premium calculated?
The premium equals the member's exposure base multiplied by the reinsurance rate that applies to the member's selected retention limit. See Reinsurance Premium for more information. Complete details on this topic can be found in the Member's Reference Guide.
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Does the WCRA make a profit?
The WCRA is a nonprofit organization. The association strives to optimize pricing, coverage, and customer service for its members, but its rates contain no profit margin. Therefore, the Board periodically examines the association's financial position in light of expected costs. Excess funds may be distributed to policyholders or members, or the Board may make assessments if there is a shortfall. These actions are determined in accordance with Minnesota law, the Board's policies, and the association's Plan of Operation.
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Can a member purchase other reinsurance coverage?
Yes and no. A member that has selected the low retention limit may purchase reinsurance from other organizations for losses below the low retention limit, but members who select the high and super limits may not. Some limited exceptions are allowed by statute. More information on this topic can be found in the Member's Reference Guide.
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What types of reports or statistical information can a member obtain from the WCRA?
The WCRA maintains a variety of data that is available to members and public policy makers. Extensive information about serious claims, benefits, financial data, and other topics pertaining to Minnesota workers' compensation is available on an aggregate basis that maintains the confidentiality of each member's claims and activities. The membership mailing list is not available to members or nonmembers.
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Why does an insurer have to be a member of WCRA if it doesn't write workers' compensation and doesn't plan to in the future?
Minnesota law requires that all insurers who are authorized to write workers' compensation are required to be WCRA members. Of course, if that member never writes workers' compensation coverage, it will never be billed for WCRA premiums.
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What does the 1.2 adjustment factor in the exposure base represent?
This number (called the pure premium adjustment factor) is an algebraic factor that corrects for variations in the exposure base over time. It allows for historical continuity and ease of comparison with the exposure base used in the WCRA's earlier years.
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Does the 1.2 adjustment factor in the exposure base raise members' premiums?
No. All WCRA members' exposure bases have included the 1.2 adjustment factor since 1984. This factor does not raise members' premiums because the rates charged by the WCRA are at lower levels (consistent with pre-1984 rates) because of the 1.2 factor. WCRA rates are set in order to collect enough premiums to cover projected losses and expenses. These projected costs are independent of the 1.2 adjustment factor.
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Does the WCRA charge late fees for late premium payments?
Yes. Premium payments should be "received at the bank" by the date indicated on the premium invoice to avoid late fees.
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Does the WCRA provide employer's liability, federal coverage, or any other types of insurance other than workers' compensation?
No. Providing Minnesota workers' compensation reinsurance protection is the WCRA's sole mission.
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I'm preparing my company's Annual Statement, Schedule F. What is the WCRA's NAIC pool number? Federal Employer Identification Number?
The WCRA's NAIC Pool Number is: AA-999-1423. For the WCRA's FEIN, please call Don Swanson at 651-229-1802 or email him at
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