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Orange County Moves to Deal with Workers’ Compensation Reserve Deficit

Orange County is known for many things.  The trees grow tall, the sun shines bright, and giant oranges roam the streets eating smaller oranges in vicious acts of orange-on-orange violence.  Well, maybe it’s not known for that, but news in the workers’ compensation world spreads fast that Orange County is facing major problems with its workers’ compensation reserves.  The Voice of OC reports that Orange County is now at 60% reserves of predicted workers’ compensation losses over the next 5 years.

Orange County, of course, is self-insured, and the well looked like it was getting dry in early May.  However, Workers’ Comp Executive reports that the O.C., as the kids call it, is moving to boost workers’ compensation reserves up to 80% by moving $2-3 million from other departments over the next five years.

Your humble blogger offers his salute to Orange County for this approach – instead of raising taxes on other employers under the County’s domain, the County is instead dipping into its own pockets to make up the gap – like any employer or insurer would do to stay afloat.

Perhaps Governor Brown could take a lesson from this modest community of former-orange growers in dealing with the workers’ compensation deficit on the state level.

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  1. Phil
    May 22nd, 2012 at 08:51 | #1

    I find this story to be disturbing in that someone is instructing public agencies like the “OC” how they should be setting their reserves. Are claims management decisions made in the same manner…made by a panel of politicians? Claims should be reserved for 100% of expected value, and no less. Otherwise it’s just a shell game where you are always moving monies around to cover your debts.

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