[K C Muffin]

Some states are controlled markets for workers comp (called "monopolistic states"). In those states, only the state can issue a comp policy. It's stupid because the state has no business in this industry.

In most states, it's only guided by the insurance department in that state. There are some country-wide guidelines, but they're not government controlled. Some of the data is mined from government and OSHA stats, but claims are managed and paid by the companies, regardless of premiums paid, just like any other insurance policy.

There's a difference and it's hard to explain, but I'll try. When each business buys a Wk Comp policy, they have a "mod" (premium modifier) based on past losses that is assigned by NCCI (again, not a governmental entity). Each insurance company can choose to accept and use that mod or not. It's in their underwriting guidelines. The mod has such a convoluted equation, I have to sit and think about it before I can figure it. It's not something that can be done simply or accurately without a lot of practice or a nice little computer!

It may be the mod that you're thinking might be a governmental issue, but it's really not. All losses have to be reported to NCCI so that the mod can be figured each year but that's done just to keep the system healthy. Wk Comp carriers do make plenty of money! It's just boring because so much of it is regulated.

The office and salaries are paid by NCCI member companies thru dues and other payments. It's not a tax-supported entity. In most states, anyway.

I guess, though, you could consider it to be tax-supported. Comp carriers only pay the limit and then they're done. So if a company carries the minimum limit and there's a catastrophic loss to an employee, the employee can only collect to the limit and then they're on their own. And sometimes they end up on welfare.