Initial Application Document Requirements

(Program Manual Table 3)

The following documents are provided as part of the initial application review:
  1. Full Service
    1. Example sales brochures used during current policy period.
    2. Typical sales proposal(s) and the forms and procedures used to gather prospect's information to assess risk and prepare proposal.
    3. Worksite supervisory manual or supervisory policies and procedures used at Client worksites.
    4. Generic or example employee safety & health manual or equivalent printed information for Client worksites.
  2. Written Business Plan
    Business Plan(s), regardless of form, for the current calendar year, including
    1. Description of key service offerings;
    2. Target market demographics (including list of states and size range/types of clients);
    3. Sales and marketing strategy to achieve controlled growth;
    4. Growth projections vs. track record;
    5. Client retention goals vs. track record;
    6. Overview of Client risk assessment and formal periodic review procedures; and
    7. Overview of risk management strategy.
  3. Organizational Structure/Staffing
    1. Organization Chart including all senior management at VP level and above, human resources management staff, and all risk management personnel (with e-mail and phone numbers), including Risk Manager(s), Loss Prevention Staff, and Claims Management Staff
    2. Biographies or resumes of all risk management personnel (including HR personnel if involved in WC risk management) and copy of each position's job description, including their decision-making authority in Client acquisition, renewals and terminations.
    3. Service contracts used to outsource any risk management functions to an independent service provider and the qualifications of the provider personnel. If the WC Carrier performs any risk management services, include that portion of the policy (or other document) describing the functions that are performed and the method and frequency of service delivery.
  4. Basic Record Retention
    1. Example of current list or other form of information used to provide WC carrier with Client Hazard Group Ratings.
    2. List of Clients terminated during past 3 years and reason for termination.
    3. Example payroll report showing WC wages by Client and worksite employee and by WC class code (to demonstrate software capability to provide such information to WC carrier).
    4. Description of how and when Client additions and deletions are communicated to the appropriate WC carrier.
  5. Employee Handbook
    6. Example Employee Handbook(s) provided during current policy period and method for distributing and documenting its receipt by worksite employees.
  6. Controllable Business Structure
    1. Copies of most recent annual IRS Form 940 for each PEO entity including Parts I, II and III with any attachments.
    2. Declaration Pages for all current WC policies sponsored by the PEO. For multiple coordinated polices, provide information for master policy only.
  7. Client Service Contract
    8. Copy of each version of Client Service Agreement(s).
  8. Client Risk Assessment
    1. Written procedures for (1) notifying WC carrier when a new client has been brought on and a client has been deleted from the client list; (2) obtaining and documenting your WC carrier’s pre-approval for prospective clients whose risk level exceeds the approval authority granted by your carrier; and (3) final authority for approving a prospective client and how his/her approval is documented.
    2. Copy of information gathering documents (Request for Proposal), which includes items in the best practices.
    3. Copy of carrier provided forbidden risk list. If you do not have such a list, please provide an explanation and provide your PEO’s internal forbidden risk list or list of acceptable risks, either of which must be consistent with the risk management expertise of your internal staff and/or contract service provider.
    4. Procedures for (1) ordering and/or obtaining a pre-contract worksite risk assessment inspection for the risk assessment process, including your criteria for ordering the inspection; (2) verifying if any significant subcontractor exposures exist and if prospective client has a system for tracking WC certificates; (3) verifying employee wage data submitted for WC class codes using the prospect’s tax records or payroll reports; (4) obtaining and evaluating prospective clients’ WC claims experience, using carrier provided loss runs and or OSHA logs (include details of all WC claims with incurred losses exceeding $25k); (5) obtaining and evaluating financial stability of prospective clients, including "sign off" by a qualified person; (6) including in the service agreement any critical loss prevention requirements identified during the risk assessment process; (7) maintaining documentation used in risk assessment process for at least six months, whether the risk was approved or declined; and (8) stating how you will conduct the required risk assessment of clients that may be with a PEO that you plan to acquire if acquisition is one of the growth strategies identified in your business plan.
  9. Loss Prevention Requirements
    1. Procedures describing how loss prevention requirements are communicated to Clients, including addition of critical loss prevention requirements to the service agreement.
    2. Example, if available, of worksite inspection resulting in either client termination due to significant loss prevention issues or the addition of "critical" requirements to the client service agreement. Provide explanation if neither issue is applicable.
    3. Procedures for assessing loss prevention service needs of prospective or existing Clients and creating corresponding service plans to meet identified needs, including the requirement that a pre- and/or post-employment background investigation be performed for certain high risk jobs. Include procedures describing documentation of service visits or other activities required by service plan.
    4. Procedures for conducting investigations of occupationally-related accidents resulting in employee injury and/or illness.
    5. Examples of accident investigations where the accident cause was identified and the Client was required to apply correction action(s).
    6. Procedures for evaluating effectiveness of prospective or existing Clients’ system for tracking subcontractor WC certificates.
    7. Example of a worksite inspection report where the certificate tracking system was evaluated and/or a recommendation made to implement or improve a system.
    8. Example of requirement submitted to Client to implement pre- and/or post-employment background investigation for employees in high risk jobs, if such a requirement is appropriate for any of your Clients.
    9. Procedures for conducting and documenting monthly (at a minimum) reviews of each Client's WC claims activity to identify clients with frequency and/or severity issues and the response to those issues.
    10. Documentation of the most recent 3 monthly (or more frequent) claims review, which identify clients with claims frequency or severity issues and describing how such issues were addressed.
  10. Claims Management
    1. Procedures for qualified claims person's contact with severely injured employees to minimize litigation.
    2. Example case file documents describing injured employee contacts by claims management for cases involving severe injury or lost time in excess of seven days, if such claims have occurred. Provide explanation if no cases are available.
    3. Procedures describing quarterly or more frequent review with WC carrier(s) to discuss status of open claims, reserve issues and general claims adjudication.
    4. Example documentation of WC carrier reviews verifying discussion of open claims, claim adjudication information submission, and reserve adjustments as appropriate.
    5. "Fraud Hotline" policy and method of communcating the policy to the worksite employees.
    6. Example from claim file notes of a case involving potential fraud or copy of "fraud tip call log" or information indicating no tip calls received for past 12 months.
    7. Procedures for conducting and documenting a monthly review of the claims activity for each WC policy. This review should include an update of WC claims information for each policy showing status of existing claims, amounts incurred, amounts paid, remaining reserves, new claims since prior month's review and the details of any claims in excess of $25,000, lost time in excess of 7 days, or with settlements over $10,000.
    8. Procedures for returning an injured employee to work including: (a) method for identification of light duty or alternate jobs before occurrence of claim; (b) use of the doctor's release to place injured employee; and (c) method of communicating policy at the employee level.
    9. List of light duty jobs created for a client and/or an example of an injured employee being returned to work in a light duty or modified duty position, if an appropriate situation has occurred.
    10. Claims reporting procedures and process for monitoring timely reporting of WC claims.
    11. Copy of past six month's (at a minimum) WC claims lag report showing percentage of claims reported on-time and follow-up activities performed to correct late claims reporting issues.
    12. Policies and procedures used to select managed care providers for WC injuries and to communicate selected provider(s) to worksite employees.


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