Using an allocation to control retained professional liability and workers’ comp insurance

The primary purpose of an allocation is to distribute costs, but there are many additional benefits. Management may be better able to control losses, promote safety, and establish a new culture in the workplace. This approach could lead to lower self-insurance costs and lower excess and reinsurance premiums. The challenge for managers is in knowing where to begin to design such an allocation or in maintaining a process for routinely reviewing the existing allocation.

This article was published on hfma.org, the Healthcare Financial Management Association's website.