Actuarial Analysis of Projected Liability and Assessment Mechanism

Introduction: The Subsequent Injury Fund (SIF) was created to provide worker's compensation benefits to injured workers who have pre-existing injuries or conditions which, when combined with a current injury, result in a significant disability.  The liability of the current employer is thus limited to the damage judged to be caused by the current injury and the Fund incurs all additional liability from the combined effects of all injuries and/or conditions.  The Fund derives its' income from assessments of insurance companies on awards of compensation for permanent disability.

Solicitation Summary: The SIF is issuing this Request for Proposals (RFP) in order to provide an actuarial review to project the adequacy of the current funding mechanism to meet the present and future (next ten years) obligations and operational costs of the fund.  The major focus of this study is to determine a total unfunded loss liability for the total of the Awarded plus the Impleaded but not yet Awarded claims.

It is unlikely that adequate financial resources will ever be available to fully fund the Fund's total liability.  The Fund will almost certainly continue to operate on a "pay as you go" basis.  Thus far, the assessment rate has proven adequate to pay all claims and allow the Fund Balance to gradually increase.  The assessment rate is subject to review by the MD State Legislature.  If future requirements indicate a need to increase the rate, it may take one or more years to effect the change.  The requested actuarial analysis is intended to provide the best possible look ahead to provide needed lead time for a rate change or to justify keeping the rate at the current level.

Procurement Program Participation Goals