Which description matches a monopolistic state fund for workers' compensation?

Which description matches a monopolistic state fund for workers' compensation?

• A. Voluntary private market
• B. Monopolistic state fund
• C. Competitive state fund
• D. State residual market plan

Answer: (B)

A monopolistic state fund means the state operates the only source of workers’ compensation coverage, and private insurers aren’t permitted to issue policies in this line. Employers obtain their coverage exclusively from the state fund, and the fund controls underwriting, pricing, and benefits. This setup contrasts with a voluntary private market, where many private insurers compete for business, a competitive state fund where the state fund competes with private carriers, or a state residual market plan, which only comes into play for employers unable to obtain coverage in the voluntary market. So the description that fits is the one where the state is the sole provider of workers’ compensation coverage.

A monopolistic state fund means the state operates the only source of workers’ compensation coverage, and private insurers aren’t permitted to issue policies in this line. Employers obtain their coverage exclusively from the state fund, and the fund controls underwriting, pricing, and benefits. This setup contrasts with a voluntary private market, where many private insurers compete for business, a competitive state fund where the state fund competes with private carriers, or a state residual market plan, which only comes into play for employers unable to obtain coverage in the voluntary market. So the description that fits is the one where the state is the sole provider of workers’ compensation coverage.