nj assigned risk workers compensation

How to Navigate Out of New Jersey’s Assigned Risk Plan

What is assigned risk.

Most states require companies to effectuate a workers compensation policy in order to legally run their business. However, carriers can decide not to insure certain companies because of the risks associated with a company’s industry, poor claims history, and/or other workers compensation related factors. Every state offers some type of program that guarantees workers compensation coverage for all companies that cannot obtain coverage directly from the insurance carrier of their choosing. For New Jersey, the NJWCIP can assign certain insurance carriers to cover these undesirable companies through their “Assigned Risk Plan.” Every company in New Jersey that is eligible and applies to the Assigned Risk Plan is guaranteed a workers’ compensation policy. However, along with not having much control over the policy that is chosen for them, companies who are forced in to applying for Assigned Risk can be assessed an additional surcharge of anywhere from 15 to 35% of their premium. In other words, your company wants to avoid Assigned Risk!

WHY You Should GET OUT of the Assigned Risk Plan?

Companies that apply for the Assigned Risk Plan, or “Market of Last Resort,” typically have high risks and will therefore experience high insurance premiums. Assigned Risk’s additional surcharge is calculated as a percentage of your premium payment(after your mod surcharge). So with a high premium, and high mod, this surcharge will have an even higher impact on your costs. The following chart shows some rough examples of premiums with corresponding surcharges that an Assigned Risk carrier can charge your company. This surcharge should be recognized as a loss because it can simply be avoided with proper risk management.

*In this simplified example, consider annual premium as the final amount you would pay, including your experience modification surcharge. For a more detailed example, scroll down.

Think of Assigned Risk’s cost to your company in the long run. If you are paying an insurance premium of $250,000,  you can lose $87,500 every year just from being classified under the Assigned Risk Plan. This cost can accumulate and in just 4 years you will have unnecessarily paid $350,000. Start the process of getting your company off of the Assigned Risk Plan and you will save hundreds of thousands of dollars.

Here is an example of someone who got a quote inside Assigned Risk & outside. You will notice a few things. One, in Assigned Risk they were assessed a 20% surcharge (PPAP Factor). In their quote outside of Assigned Risk not only do they avoid that $112,000+ surcharge but they get a $61,000 premium discount (companies in Assigned Risk are not eligible.) The final result? Roughly $160,000 per year savings! The other thing you will note however is that 1.5 experience mod adding a $200,000 surcharge. While focusing on getting out of assigned risk is important, lowering that mod is where the true long term savings will occur. The combination of a lower mod, and removal from Assigned Risk, could easily save this mid-size company $350,000-$400,000/year. But that is for another article. If you’d like more information on how to do so, contact us about our Comp Care program .

HOW To GET OUT of Assigned Risk?

You are in Assigned Risk because your business has issues in the eyes of the insurance carrier and therefore you are not attractive to them. The proper way to go about getting out is to know WHY you have these issues and taking a long term approach towards fixing them. Sit down with your insurance broker to come up with a solid strategy to make you more attractive to them. Once that approach is in place, it is your broker’s job to market you to the carrier. Just the fact that you are taking the APPROPRIATE action in engaging a risk management program can help, as opposed to shopping your policy to attempt to fix your issues. That is called treating the symptom, while you really want to cure the disease. For example going to a B rated carrier is not a long term solution and it also will not fix your experience mod problems.

The most prevalent reasons for being in Assigned Risk are:

• Poor Claims History
• Certain High Risk Industries
• Small or New Business

Some issues are easier than others to fix. But they are all curable. For your claims issue, you need to start by having an impact on safety & culture to prevent them from happening in the first place. Maybe you will want to invest in loss control. You should also have a trusted partner on the back end as well. Your insurance partner should be pressuring liability and workers comp adjusters to factually substantiate their reserving practices, and to close out files and claims fast as these claims have a a large impact on your renewal. This is a practice that is continuous 52 weeks a year and not simply done at “renewal time” as it’s too late by then.

If you’re a new business it helps to show the carrier a resume that proves you have experience in the industry or running a business in general. If you’re in a high risk industry, there are in fact carriers that will write your business, but it is no doubt harder. They do it on a case by case basis and it helps to have a broker who has a deep knowledge of workers compensation, your business, and a great relationship with workers comp carriers that write your class of business.

The Assigned Risk Plan provides a valuable product and fills a need in the world of workers comp insurance. But for most employers a trip into the pool is not a pleasant one. For a plan and/or guidance on how your specific company can get off of or avoid the Assigned Risk Plan and save capital in both the short and long run, please call a Risk Advisor at 914-357-8444. We will provide a free consultation and analysis.

You might also like

Automated page speed optimizations for fast site performance

• Search Search Please fill out this field.
• Building Your Business
• Business Insurance

Workers Compensation Assigned Risk Plans

Assigned Risk Plans Are the Market of Last Resort

What Is an Assigned Risk Plan?

• Why Workers Comp May Be Hard to Get
• Who Administers the Plan?

How Can You Get Coverage?

Pros and cons of assigned risk plans.

Suppose you try to purchase a workers compensation policy  in the standard market but no insurer will sell you a policy. This will create a dilemma since most states require employers to purchase workers compensation insurance. Fortunately, you'll have an alternative: You can secure coverage from your state's assigned risk plan .

Assigned risk plans are established by the states as a safety net for employers that are unable to obtain workers compensation coverage from "regular" insurers. They are the market of last resort for employers that would otherwise have no source of coverage. All states except monopolistic states have established a plan.   The law in each state determines how the plan is administered and financed. Assigned risk plans are also called the residual market.

The monopolistic states don't need assigned risk plans because all employers in those states are required to secure workers comp insurance from a government-operated fund.

States have created assigned risk plans so that all employers can obtain workers compensation insurance. The ultimate goal is to ensure that employees who are injured on the job will receive the benefits entitled to them by law.

Why Might Workers Comp Coverage be Hard to Obtain?

Here are some reasons why an employer may have difficulty obtaining workers compensation insurance from a standard insurer:

• Poor loss history : If a business has sustained many small losses or a few large ones, underwriters may assume its management doesn't care about safety.
• New business : A new company is difficult for an underwriter to assess because it has no track record.
• Very small business : A very small company may not generate enough premium to compensate for the risk of claims.
• Hazardous occupation : Many insurers are unwilling to provide workers compensation coverage to employers in risky occupations like logging, trucking, and roofing.

Who Administers the Assigned Risk Plan?

All states have designated an administrator that operates the plan and oversees the issuance of policies. In most states, the administrator is one of the following:  

• The National Council on Compensation Insurance (NCCI)
• The state competitive insurance fund
• The state rating organization or another third party

The NCCI administers plans on behalf of 22 jurisdictions.   Each of these states requires all workers compensation insurers that operate within its borders to participate in the assigned risk plan. Insurers may either join a multi-state reinsurance pool or serve as a "direct assignment" carrier. When an insurer participates in a pooling arrangement, it may act as a servicing carrier (issuing policies and paying claims) or provide reinsurance to servicing carriers. If an insurer chooses the direct assignment option, it must agree to accept and retain all risks assigned by the NCCI. The direct assignment insurer pays all losses incurred by the assigned employers and is not reimbursed by reinsurance.

In 14 states, the assigned risk plan is administered by the state competitive fund. Examples are California, New York, and Montana. Most of the remaining states have designated their rating organization or an insurer as their plan administrator.  

If you or your insurance agent is unable to secure workers compensation coverage for your business in the standard market, you or your agent may submit an application to your state's assigned risk plan administrator. The application procedure varies by state. If the plan in your state is administered by the NCCI, you can apply online 24 hours a day or mail your application to the NCCI via the U.S. Postal Service.

If the plan in your state is administered by a state fund or rating organization, check the administrator's website for application instructions.

To obtain coverage in the residual market, you must have applied for coverage and been rejected by one or more insurers. The number of required rejections varies by state. For instance, employers in West Virginia can apply for coverage in the assigned risk plan only if they provide evidence of rejection by two insurers.  

The primary advantage of an assigned risk plan is that it provides coverage to employers that can't obtain insurance in the standard market. One major disadvantage is cost. Employers insured in the residual market generally pay higher rates than those insured in the voluntary market. Those whose experience modifier is greater than 1.0 may also be subject to a surcharge.   In addition, some states have eliminated the premium discount on assigned risk policies. An example is Massachusetts.   A premium discount is a credit applied when the premium exceeds a certain threshold.

Another drawback of assigned risk plans is that employers can't choose their insurer. Their policy is issued and managed by the plan administrator or servicing carrier. A third disadvantage is limited coverage. Policies issued in the residual market may not be as broad as those purchased from standard insurers. For instance, many policies afford no coverage for operations the employer undertakes in states other than the one where the policy was issued.  

Key Takeaways

• Assigned risk plans serve employers that can't find workers comp coverage in the standard market.
• Most plans are administered by the NCCI, a state insurance fund, or a state rating agency.
• Policies purchased from an assigned risk plan are generally more expensive and provide less coverage than policies obtained in the standard market.

IRMI. " Assigned Risk Plans ." Accessed July 30, 2020.

IRMI. " Workers Compensation Residual Market ." Accessed July 29, 2020.

NCCI. " Insuring the Uninsurable. Workers Compensation Residual Market ." Accessed July 29, 2020.

NCCI. " Options for Submitting Assigned Risk Applications Online ." Accessed July 29, 2020.

State of West Virginia, Offices of the Insurance Commissioner. " Workers’ Compensation Assigned Risk Plan ," Page 2. Accessed July 29, 2020.

NCCI. " Assigned Risk Adjustment Program ." Accessed July 30, 2020.

The Workers Compensation Rating and Inspection Bureau of Massachusetts. " Premium Discount ." Accessed July 31, 2020.

NCCI. " Producers' Guide to Understanding NCCI's Residual Market Limited Other States Insurance Endorsement ." Accessed July 30, 2020.

XL LG MD SM XS

Official Site of The State of New Jersey

• FAQs Frequently Asked Questions

The State of NJ site may contain optional links, information, services and/or content from other websites operated by third parties that are provided as a convenience, such as Google™ Translate. Google™ Translate is an online service for which the user pays nothing to obtain a purported language translation. The user is on notice that neither the State of NJ site nor its operators review any of the services, information and/or content from anything that may be linked to the State of NJ site for any reason. - Read Full Disclaimer

• Search close

Workers' Compensation

If you have any questions regarding services provided by the Division of Workers’ Compensation, please contact us as indicated below.

• General inquiries
• Court directory
• Administrative staff directory

Atlantic City Workers’ Compensation Court (Serves: Cape May and Atlantic Counties)

Bridgeton workers’ compensation court (serves: cumberland county and salem counties), camden workers’ compensation court (serves: camden and gloucester counties), freehold workers’ compensation court (serves: monmouth county), hackensack workers’ compensation court (serves: bergen county), jersey city workers’ compensation court (serves: hudson county), lebanon workers’ compensation court (serves: somerset, hunterdon and the southern half of warren county), mt. arlington workers’ compensation court (serves: sussex, morris and the northern half of warren county), mt. holly workers’ compensation court (serves: burlington county), newark workers’ compensation court (serves: essex county), new brunswick workers’ compensation court (serves: middlesex and eastern somerset county), paterson workers’ compensation court (serves: passaic county), plainfield workers’ compensation court (serves: union county), toms river workers’ compensation court (serves: ocean county), trenton workers’ compensation court (serves: mercer county), judicial staff and home office assignment.

Staffing assignments effective January 15, 2024

* Supervising Judge 

** Administrative Supervising Judge

*** Director/Chief Judge

Central Office Management Staff

Central office key administrative staff, tech unit (hearing calendars, e-mail calendar program, courts on-line).

If you need assistance with COURTS on-line, electronic filing, or electronic calendars, please e-mail [email protected] or call 609-777-4921 / 609-292-2556.

Office Supervisors/Program Technicians

District office head clerks, office of special compensation funds, counsel for the uninsured employers fund.

To Report an Uninsured Employer, email [email protected] or call 609-984-2485.

• Frequently Asked Questions
• Forms and Publications

Injured Worker Protections

• What to do if you are injured at work
• Benefits for injured workers
• Navigating disputes with your employer
• Filing a discrimination complaint
• Lawyer referral services

Employer Requirements

• Insurance coverage requirements
• Reporting work accidents and occupational exposures
• Navigating disputes with employees

Insurance Carrier Requirements

• Insurance carrier contacts requirement
• Supplemental benefits for public safety workers

Tools and Resources

• Online Services
• Legal Information
• Rates and Statistics
• Judicial Information

Get Support

• Navigating Disputes
• Fraud Regulations and Reporting

Primary Link

• Secondary Link
• Governor Phil Murphy
• Lt. Governor Tahesha Way
• Services A to Z
• Departments/Agencies
• Privacy Notice
• Legal Statement & Disclaimers
• Accessibility Statement

Applications seeking a premium credit from the NJ Construction Credit Premium Adjustment Program (CCPAP) must be submitted online.

• Information
• Instructions
• Notifications
• CCPAP Online Application supports most major browsers, including Google Chrome, Microsoft Edge, and Mozilla Firefox.

Helpful information about the CCPAP

Online Application Instructions

Advisory Bulletin 65

File Downloads

The latest class experience downloads, for carriers only.

• Excel Format

Excel File Download

This Excel file, for Carriers only , contains the latest Class Experience in a Microsoft Excel format.

The latest Rates and Classification Wording (WCRATE) Downloads

• Text File (Delimited)

This Excel file contains the both the latest rates and classification wording in a Microsoft Excel format.

Text File Download

This Text file contains the both the latest rates and classification wording in a standard flat text file with no delimitation.

Text File Delimited Download

This Text file contains the both the latest rates and classification wording in a standard text file delimited by the dollar sign.

document.write(new Date().getFullYear() - 1)

Document.write(new date().getfullyear()-2), document.write(new date().getfullyear()-3), document.write(new date().getfullyear()-4), document.write(new date().getfullyear()-5), the latest experience rating modification downloads.

• DAT File (No Carriage Breaks)
• DAT File (Carriage Breaks)

DAT File Download

(No Carriage Breaks)

(Carriage Breaks)

The latest Residual Market Downloads

Get Better Quotes 35+

Real Experts- Trusted Advice

• 888-611-7467 --> Start a Quote 888-611-7467

NJCRIB New Jersey Assigned Risk

Compare other workers' compensation coverage with njcrib..

Prefer to speak with A Workers' Compensation Specialist?

Give us a call today

What we quote with NJCRIB Employers Insurance?

Get a workers comp quote from NJCRIB Employers Insurance.

Top selling programs.

• Home Health Care
• Assisted Living
• Amazon DSP Delivery
• Roofing Contractors
• Construction
• Plumbing Contractors
• Staffing Agencies
• Tree Service
• HVAC Contractors
• Electrical Contractors
• Non-Emergency Medical Transport

Other Business Class Codes

• Commercial Cleaning
• Concrete Flat Work
• Trim Carpentry
• Manufacturing

Our Specialists shop your coverage with more insurance companies.

Ask about our Pay As You Go plans designed to improve cashflow and bullet-proof your audits.

State fund insurance coverage for all business owners.

NJCRIB is a New Jersey insurance carrier. They are a competitive State Fund carrier and manage the Assigned Risk program and administer the state's Classification System. NJCRIB Employers Insurance is an A-Rated insurance company and writes every class of business. State fund insurance is typically needed when a business can't find a private insurance company to write their workers compensation insurance . They offer:

• Access to coverage regardless of claims

Getting Service From NJCRIB

973-622-6014

60 Park Place 12th Floor Newark, New Jersey 07102

Workers' Comp Industry Programs

NJCRIB Employers Insurance is a New Jersey Insurance Provider

Find rules, rates, guideline, forms and helpful information..

• Connecticut
• Massachusetts
• Mississippi
• New Hampshire
• North Carolina
• North Dakota
• Pennsylvania
• Rhode Island
• South Carolina
• South Dakota
• Washington DC
• West Virginia

Why Shop NJCRIB Employers Insurance With Us?

Our Quoting Process Makes Us Your Best Choice

• Proprietary comparative rating software system.
• Large book size to leverage with our carriers.
• Highly trained agents specializing in workers comp.

Get a Quote with NJCRIB Employers Insurance.

Workers Compensation Info

• What is Workers Compensation?
• Workers Compensation Class Codes
• Experience Modification Rates
• How Much Does Workers Comp Cost?
• Workers Compensation by State

Employer Resources

• Workers Compensation Rates
• Rules for Workers' Comp
• Frequently Asked Questions
• Find a Workers Comp Form
• Get Workers Compensation Quotes

Workers Comp Programs

• Best Selling Workers Comp Programs
• Pay As You Go Insurance
• Self Monthly Workers' Comp Reporting
• The Hartford Workers Compensation
• Multi-State Workers Comp Coverage

Customer Service

• Certificate of Insurance
• Make a Payment
• Report a Claim
• Workers Compensation Insurance Audits
• Staff Directory
• Workers Compensation Shop.com

National Broker Services

• Insurance Agents
• Payroll Service Companies

• 7 Ridgedale Avenue, Suite 204, Cedar Knolls, NJ 07927

888-539-3737

[email protected]

Are You Currently in the New Jersey Assigned Risk Workers’ Compensation Plan?

Have you recently been placed in the NJ High Risk State Pool?

Has your broker presented a cost saving solution to control spiraling costs or explored alternative markets?

Consider These State Plan Disadvantages:

• Excessive Surcharges – 20% to 35% Higher Premiums
• Exorbitant Claims Payouts – Increasing Annual Costs
• Abusive Audits / No Customer Service

If you’re unhappy with your broker’s service, then we are the right fit for you! Take Control of Your Worker’s Compensation Costs!Call us directly at 973-200-6928 for a Cost Overview Analysis and a Go-Forward Action Plan.

Recent Posts

Protect Against Cyber Crime Targeting Real Estate Purchases

August 10, 2017

Get Peace of Mind with ID Fraud Insurance

July 27, 2017

Be Prepared. In all Circumstances.

July 21, 2017

Our Location

Call center.

Madison Insurance Group is a specialist insurance brokerage based in Morristown, New Jersey.  We work with public and privately held businesses throughout the Northeast and nationwide.  Most of our clients come to us on the recommendation of other clients, or their attorneys, accountants and/or financial advisors. 

Valuable Resources

• Ben/Tech HR Portal
• Corporate Insurance
• Cyber Liability Insurance
• Directors & Officers
• Errors & Omissions
• General Liability
• High Net Worth
• Identity Fraud
• Jewelry & Art
• Kidnap & Ransom
• Multiple Residences
• Personal Insurance
• Private Jet
• Private Yacht
• Vintage Car
• Worker’s Compensation

Stay Connected

• What’s Hot in Workers' Comp – Special NJ Alert

On January 16, 2024, the Governor of New Jersey signed A-5909/S-4267 into law. The amendment revises workers’ compensation coverage for certain injuries to volunteer and professional public safety and emergency personal. The bill amends N.J.S.A. 34:15-7.3, adding that a response to an emergency, including remediating work thereafter, is sufficient work to cause injury or death to be compensable.

Section 7.3 of the statue holds that, should a cardiovascular or cerebrovascular injury or death occur to an individual covered by this section while engaged in a response to an emergency, there shall be a rebuttable presumption that the injury or death is compensable, if that injury or death occurs while the individual is responding, under orders from a competent authority, to a law enforcement, public safety or medical emergency. This amendment now includes “remediating from” an emergency as a compensable action. This has been defined to mean leaving an emergency in a reasonable period of time, not to exceed 24 hours from the end of the emergency, to carry out post-incident agency protocols and decompression, including things such as critical incident stress debriefings.

The presumption of compensability is rebuttable by use of such things as horseplay, skylarking, self-infliction, voluntary intoxication and illicit drug use among other defenses. Clear and convincing medical evidence that the work experience was not a substantial cause of the cardiovascular or cerebrovascular injury is needed to overcome the presumption. 

The Bill also expands coverage under this section to include career emergency medical technicians and paramedics employed the state, municipalities, or private sector employers who engage in public emergency medical and rescue services.

The amendments are effective immediately and apply to all applicable injuries and deaths for which claims are pending on the date of enactment. 

The Bill addresses the concerns of public safety personnel and first responders about, not only the physical toll in responding to emergencies, but also the emotional and environmental stressors that continue after the immediate response to an emergency has ended. It has yet to be seen how this amendment will impact the number of claims filed as the covered activities have been expanded but, also, the number of covered employees who are now afforded benefits under this section of the statute.

Latest Posts

• Pennsylvania Supreme Court Confirms the Validity of ‘Regular Use Exclusions’
• What’s Hot in Workers’ Comp – Special PA Alert
• Sixth District Court of Appeals Says Fourth District Got It Wrong: Florida’s Pre-Suit Notice Requirement Does Not Apply Retroactively
• Third Circuit Clarifies Availability of Qualified Immunity for Police Officers Accused of Deliberate Indifference to Arrestees’ Need for Medical Care Following Ingestion of Narcotics

See more »

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

Refine your interests »

Written by:

Published In:

Marshall dennehey on:.

"My best business intelligence, in one easy email…"