It's time to say goodbye to the old hands-off approach to workers' compensation risk management.

That was the main message at the Agent's Role in Workers' Comp Risk Management & the Claims Process breakout session at WCEC on Aug. 18. The two-day session kicked off on Monday with a panel lead by Corey Mathews, CEO and executive vice president of PIA of Florida.

On the panel was John McMahon, vice president of McMahon & Hadder in Fla.; Joe Carraher, senior account executive at Lutgert Insurance in Fla.; and Lew Kachulis, president & CEO of Synergy Comp Insurance Co. in Pa.

McMahon, who has worked in workers' compensation since 1979, emphasized that agents should be very involved with their clients. Rather than simply presenting clients with a policy and selling them the least expensive policy, McMahon says it is in both an agent and client's best interest to make sure the client is educated in what they are getting. One of the most important parts of workers' comp that agents should help their clients with are audits.

“Agents should be involved with their clients,” says McMahon. “[It] helps retain clients, by going with them to audits and making sure you know all the rules and work around them [to help clients], while still following [the rules].”

Carraher also discussed the changing role of the agent in the workers' comp claims process. Previously, too many agents were focused on dividends–and dividend hunting resulted in bad practices, like not reporting claims. Carraher explains that dividends are now dramatically lower and the experience mod has become the most important factor for employers.

Because of that, Carraher says agents should focus on taking care of the mod, and in time the dividends will take care of themselves. He recommends that agents educate themselves on what moves the needle on mod, and utilize software to get real time analysis of claims–and educate the client on that analysis.

“The days of ignoring claims are gone,” says Carraher. “Agents can either get to higher ground or get crushed.”

Kachulis' presentation focused on getting the employer involved in workers' comp decisions. Typically CFOs are involved in the buying deicision, but Kachils emphasized the importance of getting the CEO or owner of a company in on the decision as well, because they both understand different aspects of a safety culture purchase.

“CEOs are self-funding their claims,” says Kachulis. “They need to learn the indirect cost of a workplace accident.”

To do that, Kachulis says agents should create spreadsheets on every company with its average claims cost, its percentage of claims litigation, the average adjuster case load, and the percentage of claims closed in 90 days. If the numbers are not comparable to the industry average, its time for the agent and company to work together to lower their costs.