The Builders' Association: BASIF provides contractors with workers' comp coverage

Bill Wien is publications director with The Builders' Association. This article was originally published in The Modern Builder.

The Builders' Association Self-Insurers' Fund has had a history of consistently issuing dividends to its participants. BASIF has distributed more than $13 million in dividends in its 20 years.

But the recent payment of a $1 million dividend "is virtually unheard of in the volatile insurance market of today," said Hoot Gibson, director of BASIF. "Even with the chaos in workers' comp and throughout the insurance industry, we've remained an entity with extremely competitive rates and the ability to provide a dividend."

How BASIF does it

To borrow a phrase from the U.S. Marine Corps, BASIF is looking for a few good contractors. Contractors must qualify for membership, and the key to being a member is risk management. Contractors who are committed to risk-managing their workers' comp and making loss prevention/loss control their No. 1 priority help control premium costs.

BASIF is self-administered. Instead of using a third-party claim handler, BASIF employs a veteran team of claim professionals who provide first-rate risk management services. Contractors can rely on their advice on how best to handle their workers' comp exposure.

"Contractors can count on BASIF staff to be as concerned about safety as they are. They know they've got an ally here," said Gibson. "Our livelihood comes from how well those companies do."

Participants in BASIF benefit from a variety of workers' comp services. These include specialized onsite safety inspections, safety training, expertise on hiring new employees, and assistance in developing and implementing drug and alcohol programs.

One adjuster is assigned to one client at BASIF, so when contractors have a claim, they know who to call. And BASIF staff have manageable caseloads, so they can focus on specific issues that will mitigate loss.

"How a claim is handled can have a significant impact on the final cost of the claim," Gibson said.

BASIF is governed by a board of trustees. These eight trustees are all construction industry participants who understand the needs of the construction industry.

BASIF rating

BASIF was the first workers' compensation pool in the United States to receive a rating from the A.M. Best Company, whose Best's Ratings are the industry's standard measure of insurer financial performance. A Best's Rating is assigned after an extensive quantitative and qualitative evaluation of a company's financial strength, operating performance and market profile.

In 1997, BASIF was rated "A-minus," a rating it has maintained ever since. This is the highest rating BASIF could qualify for based upon its size.

BASIF is one of only five pools in the United States to have a Best's Rating, according to Gibson.

Online claim reporting

BASIF members can report claims online at www.BASIF.com. Online claim reporting saves the contractor time and is less complicated than tradition al filing. "It eliminates redundant paperwork and inaccurate data," said Mindy Yancey, claims manager.

Gibson said, "Contractors can also access safety materials, claim management tools, and policy service information online."

Coverage

Skip Hutton, administrator and founder of BASIF, said, "BASIF was founded in the early 1980s to provide a stable workers' compensation marketplace for our contractors. During that time period, a majority of commercial insurance companies would not write workers' compensation coverage for construction employers.

"Since that time, BASIF has provided a stable market, despite the cyclical nature of the industry. Because workers' compensation can be controlled by aggressive loss and claims management, we are looking for the contractors who are willing to place a heavy emphasis on those two factors. BASIF may not be a fit for everyone. For the employers who understand that losses can be controlled, it is a real haven."

BASIF has 425 participating employers or contractors in all and an annualized premium of about $21 million. Membership in BASIF is restricted to Missouri and Kansas, but the Builders' Outstates Insurance Plan, which provides participants with coverage outside Missouri and Kansas, covers 22 additional states.