Page 2 - AO Insurance FlipBook

The days that transpire between an employee incident and the insurer or third-party administrator receiving the report are known as the claims
reporting lag time. Both employee
lag and employer lag are the two
components of lag time. Employee
lag is the time it takes the injured
worker to report an incident.
Employer lag is the time it takes
the employer to report the incident to the insurer after receiving notice from the employee. The National Council on Compensation Insurance found that delays in reporting increased claim costs by 51 percent. Also, late reporting is characterized by greater attorney involvement, more lump sum payments, and lower closure rates. Best practices for reporting are to do so within 24 hours to 3 days.
The first component
of lag time is difficult
to control, especially for large, complex organizations. The second component
is directly within the control of the employer.
As soon as possible after the injured worker reports the incident, the employer should alert the insurer. Claimants should not be left wondering what will happen to their
medical bills or whether they will
be paid for lost
time. Adjusters
can alleviate these worries by calling the injured worker shortly after learning of the incident.
Here are two simple steps to reduce lag time:
• Train employees on incident reporting. Training
is a continuous process that should be done during orientation and supported with ongoing reminders.
• Streamline the reporting process. Employees should know the process and with whom to report incidents. Supervisors should be the points of contact, and a backup needs to be identified in case of an absence.
By: Lukasz Karwowski, ARM Karwowski Risk Services
Austin, TX karwowskiriskservices@gmail.com