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<h1>State Fund Discontinues Group Insurance Plan</h1>
<h3 align="left">December 3, 2014</h3>
<p>Since the implementation of tiered rating in March 2013, State Fund has broadened its pricing structure and allowed more accurate rating to an individual policyholder’s risk.</p>
<p> Under tiered rating, State Fund is able to offer fair prices to a much broader range of employers, allowing it to remain a strong and stable provider of workers' compensation insurance for all California employers. </p>
<p> Throughout 2014, State Fund performed an in-depth evaluation to understand how the group insurance discount was working with tiered rating. Originally, State Fund introduced the group insurance discount to recognize and reward employers whose loss history demonstrated a culture of safety. Trade associations who had agreements with State Fund received an administrative fee, which averaged approximately four percent to six percent of premium. </p>
<p> The study concluded that the tiered rating plan has the same effect on policyholders as the group discount, reflecting individual performance and recognizing employers with demonstrated safety records with appropriate pricing. </p>
<p> In light of this analysis, State Fund has decided to discontinue group insurance and will not be renewing group agreements in 2015. Additionally, the group insurance discount will be eliminated April 1, 2015 for all groups, including the California Farm Bureau Federation.</p>
<p> State Fund underwrites many Alternative Dispute Resolution (ADR) groups. Beginning in 2015, we will continue to offer specialized claims handling for these groups, but we will no longer discount the policies nor pay administrative fees.</p>
<p> “The workers’ compensation market has changed dramatically and the decision to discontinue the group insurance program is not a reflection on the quality of the employer associations’ value to their industry and members, but rather supports our efforts to manage costs and support fair pricing for all California employers,” said Jennifer Vargen, Executive Vice President, Public Affairs. “State Fund recognizes the value employer associations bring to California and will seek opportunities to collaborate with them on safety and other issues important to California employers.”</p>
<p> For more information, contact 1-888-STATEFUND.</p>
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