Term

Definition

A.M. Best

organization that analyzes and reports on the financial stability of insurers

accident-free work days

one measurement employers use to gauge the effectiveness of their loss control programs

accident report

older term for first report of injury

accidental injury

required by earliest versions of US WC laws; some jurisdictions have dropped this test of compensability

accelerated condition

medical condition that deteriorates faster due to a work injury, illness, or exposure

Act

alternate term for statutes or law (e.g., WC Act)

activity check

investigation performed by a claims specialist or investigator to determine whether an injured worker is performing physical tasks that exceed stated work restrictions

acts of God

natural phenomena (lightning strikes, wind storms, earthquakes, and so forth) that may be compensable only if the employment increases the risk of exposure to them

actuarial reserves

reserves based on a formula developed by an actuary rather than the facts and probable outcome of a single claim; sometimes called formula reserves

actuary

statistician who computes insurance risks and premiums

adjuster

older term for claims specialist; person who settles claims by determining the amount of loss or damage

administrative closure

claim that remains open legally but is considered "closed" by a claim administrator or WC regulator due to lack of activity

administrative law judge (ALJ)

judge who works in a dispute resolution system, like WC, that is not part of the traditional civil courts

advanced payment (advance)

payment, either voluntary or ordered by an administrator, of WC benefits likely to be owed in the future; if commuted to present value, often called a commutation

advisory loss costs

costs based on insurer loss histories that insurers and advisory organizations use to make rates

advisory organization

updated name for rating bureaus such as NCCI — this name more accurately reflects the fact that these bureaus today are more likely to develop advisory loss costs than actual premium rates

agent

insurance sales entity that, in most instances, is the legal representative of the insurer as seller

aggravation of an injury

for WC, a re-injury of a medically stable body part significant enough to require medical treatment

aggregate excess insurance

insurance that limits the policyholder’s overall self-insured losses during a policy period to a predetermined level

agreement

formal agreement between a claim administrator and the injured worker specifying the type and amount of WC benefits payable to the injured worker

agricultural worker

farm worker that may or may not be covered by state WC laws

alcohol use

for WC, injuries occurring while the worker is under the influence of alcohol raise compensability issues

alive-and-well check

specialized activity check to ensure that beneficiaries, such as dependents in death cases, are alive and still entitled to benefits

allocated loss adjustment expenses (ALAE)

insurer's costs which relate to one specific claim

alternate employer

a special employer or temporary employer

Alternate Employer Endorsement

extension of the general employer’s WC policy that covers a special employer or temporary employer

alternative dispute resolution (ADR)

any approach to resolve disagreements outside of a formal court process; the best known of these are arbitration and mediation

AMA Guides to the Evaluation of Permanent Impairment

impairment rating guidelines used in many states to bring more consistency to permanent impairment ratings or permanent disability awards; currently the AMA 4th, 5th, and 6th editions are in use

American Federation of Labor - Congress of Industrial Organizations (AFL-CIO)

voluntary federation of numerous national and international labor unions

Americans with Disabilities Act (ADA)

federal law requiring some employers to make reasonable accommodation for qualified individuals who can perform the essential functions of a job

anniversary rating date

for experience-rated policies, the date when the experience modifier and resulting rate changes take place

Anniversary Rating Date Endorsement

endorsement to WC policy that allows an anniversary rating date other than the inception date of the policy

annuity

financial contract where a life insurer pays periodic benefits over a fixed period of time or a lifetime; in WC, often used as part of a structured settlement

appeal

request to have a lower-level decision reviewed (the appealing party requests the decision be overturned)

appeals court

any court that reviews the earlier decision of another court

appellate court

same as appeals court

application

for WC, an employer’s written request to the insurer’s underwriting department for WC coverage

apportionment

for WC, a medical provider's opinion of the portion of a permanent disability attributed to non-industrial causes

arbitration

form of alternate dispute resolution where an arbitrator or panel of arbitrators reviews facts informally and issues a decision that binds the parties

arbitrator

any decision-maker for an arbitration

arising out of and in the course of employment (AOE/COE)

key test of compensability: did the worker's injury or occupational disease originate while he or she was engaged in the business of the employer, upon the employer's premises or elsewhere by the direction, express or implied, of the employer?

assigned risk plan

sometimes called the Pool, this is a residual market program established by individual states to make sure that employers can obtain WC insurance even if insurers are not willing to write such insurance voluntarily – most assigned risk plans charge higher rates than those for the voluntary market

assumption of risk

prior to WC, the employer did not have to pay damages to an injured worker if the worker voluntarily assumed the risks associated with the employment

attending physician

older term for a medical provider that treats the worker

attorney fee schedule

regulations setting the maximum fees that workers can pay attorneys for legal services performed in WC cases

audit

the WC policy gives the insurer the right to audit all employer records that relate to the policy

audited premium

final premium for a policy term, determined by auditing actual payroll exposures

authorized rate

a rate approved for use by the state

average daily wage (ADW)

calculation of the worker's average daily earnings sometimes used to determine the amount of wage replacement benefits owed, particularly where the average weekly wage would not be an accurate representation of earnings

average weekly wage (AWW)

calculation used to determine the amount of wage replacement benefits owed – the average earnings for a fixed number of weeks are calculated and benefits are computed according to that amount

award

decision of a WC regulator ordering payment of benefits, fees, or other consideration