Update For New Jersey Producers

March 13, 2019

A Message to Our Producers

In light of recent press regarding Applied Underwriters®, our EquityComp® product, and captive reinsurance practices in the state of New Jersey, we'd like to share a few important facts.

EquityComp is a workers' compensation insurance product for larger businesses seeking to retain risk in their own insurance placements. This product uses the highly structured, well-established, regulated, and common practice of captive reinsurance.

At Applied Underwriters, the captive risk is held in a full-fledged insurance carrier subject to the standards of an insurer domiciled and regulated in the U.S. under the National Association of Insurance Commissioners (NAIC) standards and evaluated by AM Best.

According to the most recent NAIC data available, the captive insurance industry earned $81 billion in premium in 2017. A recent study conducted by the National Academy of Social Insurance (NASI) estimates that nearly 25% of all workers' compensation claims in the U.S. ultimately flow into captives for the purpose of self-insurance.

If the New Jersey Department of Banking and Insurance (NJDOBI) complaint against Applied was successful in invalidating our use of captive reinsurance, this precedent could nullify the use of captive insurance in New Jersey and have enormous financial ramifications across the state.

NJDOBI initiated its action in response to Applied Underwriters' Petition filed with the NJDOBI which sought to reiterate the validity of captives in New Jersey.

Applied Underwriters operates one of the largest broker networks in the United States, with over 40,000 individually named insurance brokers across 6,000 insurance agencies with whom we communicate regularly each month.


When Certainty Matters

Offer your clients JumboGC®, the competitively priced guaranteed cost policy designed specifically for your largest clients.

The essential terms of JumboGC include:

  • Risks with a minimum of $200,000 in premium to $10,000,000 and beyond
  • All states and all areas, with multi-state risks insured seamlessly
  • Most classes accepted with few prohibited exposures
  • Monthly reporting and billing to promote more control over cash flow
  • No collateral or letters of credit
  • Access to Applied Underwriters' best-in-class claims services
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