BrickStreet Mutual Insurance Co. may have the lock on West Virginia’s workers’ compensation insurance business now but that doesn’t mean others aren’t interested.
State Insurance Commissioner Jane Cline said at least nine major insurers have approached her agency about entering the West Virginia market. By law, BrickStreet has the exclusive rights to provide workers’ compensation until next year. After that, companies can seek coverage from other insurers.
The legislature moved in 2005 to privatize West Virginia’s workers’ compensation system. BrickStreet went into business in January 2006. By law, BrickStreet will continue to be the sole provider of workers’ compensation coverage for state and local governments until 2012.
Cline said the insurance companies interested in providing coverage for injured workers are already doing business in West Virginia.
Greg Burton, BrickStreet’s president and chief executive officer, said the company is preparing for competition and is taking steps to become more customer friendly.
The company has created eight business teams that will focus on particular accounts. One team will focus on the coal industry, another on government and the rest will be assigned to clients based on how much they pay in annual premiums.
Burton acknowledge some business might be lost when the market opens up, but the market for workers’ compensation in West Virginia is small.
“West Virginia is $475 million worth of premiums,” he said. “In the scope of things nationwide that is not a very big market.
“When you start peeling all that away, there’s probably about a couple hundred million dollars really worth the effort and time,” he said.
To control costs in the future, Burton said BrickStreet may have to reduce its staff of 500 employees to trim its $24 million annual payroll.
“We want to retain as many of those employees as we can, but, again, we do not want 100 percent of the market,” he said.
Burton also said there are no immediate plans to follow Nevada and make BrickStreet a public company. Any move like that would require legislative approval, he said.
Information from: The Charleston Gazette,
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