Alternative Funding Mechanisms for Workers' Compensation: An International Comparison

26 Pages Posted: 3 Oct 2006

See all articles by Robert W. Klein

Robert W. Klein

Georgia State University

Gregory Krohm

University of Wisconsin - Madison - Department of Actuarial Science, Risk Management and Insurance; International Association of Industrial Accident Boards and Commission

Abstract

Countries vary greatly with respect to how they fund workers' compensation systems in terms of the sources of funds, the mechanisms used, and the allocation of system costs among employers and others. These different funding approaches can have significant implications for system performance, including employers' incentives to promote workplace safety. Government officials and other stakeholders have a strong interest in systems in other jurisdictions as they consider improvements to their own schemes. This paper examines the major alternative approaches to funding compensation for work-related injuries and illnesses, their rationales, and their administrative and behavioural consequences. We discuss the relative advantages and disadvantages of different systems and the trends toward more refined, actuarially based approaches intended to promote greater equity and efficiency.

Suggested Citation

Klein, Robert Warren and Krohm, Gregory, Alternative Funding Mechanisms for Workers' Compensation: An International Comparison. International Social Security Review, Vol. 59, No. 4, pp. 3-28, October-December 2006. Available at SSRN: https://ssrn.com/abstract=934598 or http://dx.doi.org/10.1111/j.1468-246X.2006.00251.x

Robert Warren Klein (Contact Author)

Georgia State University ( email )

5387 Northchester Ct
Atlanta, GA GA 30338
United States
404-386-1591 (Phone)

Gregory Krohm

University of Wisconsin - Madison - Department of Actuarial Science, Risk Management and Insurance ( email )

Madison, WI
United States
(608) 265-4004 (Phone)

HOME PAGE: http://www.wisc.edu/directories/results.php?name=GREGORY%20KROHM&email=gkrohm@bus.wisc.edu

International Association of Industrial Accident Boards and Commission ( email )

Madison, WI
United States

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