Winter has come early…

Winter had come early to the Methow Valley.

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For Employers Conducting Business Abroad, Kidnappings Remain an Ongoing Concern

With L&I seriously undercapitalized – what do they do now?

In my post last month I wrote about the November 2 ballot initiative in Washington State – I-1082. I-1082 sought to end the Washington Department of Labor & Industries (L&I) monopoly on workers’ compensation insurance by allowing private insurers to compete with L&I.

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Six Chubb subsidiaries suspended from writing new business

Today, we were notified that the Office of the Washington State Insurance Commissioner has suspended six Chubb subsidiaries from writing new business/clients in the State of Washington for nine months.

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The day the charge exceeded $50.00. I had to find out why?

The other day when I was refilling my car with gas I noticed that the charge exceeded $50.00. I have had the same car for quite some time and it had been a few years since it cost $50 to fill up, so my curiosity was tweaked.

I checked the business gauges and noticed that the price for a barrel of crude has reached $82.55. Not quite were it was in late 2008 when oil topped out at close to $150 a barrel, but considerably up from the February 2009 price of $31.04 a barrel. Supply, demand and the relative value of the dollar are all contributing factors in the crude oil price equation.

The recent global recession and decline in demand, curtailed oil production by its’ largest percentage since 1982. BP estimates that global oil reserves at year end 2009 were 1,333bn barrels. What is remarkable is that reserves are 23% higher than a decade earlier, despite 300bn barrels of consumption during the period.

Hubbert’s Peak, when oil reserves begin to fall, and prices begin to rise relentlessly, however has not been reached. M. King Hubbert, a geologist, predicted US oil production would peak in 1970, and it did. What Hubbert did not predict or account for however, was the growth of global trade or the improvements in oil industry technology and geological knowledge. Iraq recently disclosed that it has 25% more proved oil reserves than the last time it looked. Brazil says that one of its recent discoveries could be 8bn barrels, twice what was originally estimated. Hubbert’s Peak will no doubt be reached some day, but it remains a moving target, continuously delayed by new discoveries and data.

Oil industry concerns today are different: the rising cost of extraction, the impact of the recent BP Gulf of Mexico accident and resource nationalism. Seven of the top 10 source countries have shut out western oil companies (Canada, Iraq, Kazakhstan are the exceptions). The demand for oil shows no sign of peaking according to the International Energy Agency which forecasts that daily demand will increase by 20m barrels a day by 2030. Fundamentally though, the rising price of oil can be attributed to rising Chinese consumption and to the rising investment demand of extraction. More peak oil scares are most likely on the horizon.

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The Wall Street Journal Compares L&I in WA & OR

The Wall Street Journal published an article on Sunday comparing L&I in Washington and Oregon.

Average time loss claims in Washington is 270 days which is twice the national average and compares to 70 days in Oregon which has private insurance.

In 2007 and 2008 Washington granted lifetime pensions to 3,600 workers compared to 24 in Oregon.

Last year there was a 7.6% increase in L&I premiums. Oregon hasn’t raised premiums in 2 decades and this year returned $100 million to employers. 

In West Virginia which transitioned to a competitive market 5 years ago approximately 200 insurers moved in the market and premiums dropped 30%.

We ask that you consider voting yes on I-1082
Read the full article here

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IRS Releases Draft W-2 Form for 2011; Announces Relief for Employers

The IRS released a 2011 Draft W-2 form yesterday, October 12, 2010, which can be used by employers to report wages and employee tax withholding. They also announced the deferment of the new requirement for employers to report the cost of coverage under an employer-sponsored group health plan.

The IRS continues to stress that this reporting is for informational purposes only. The amounts reportable are not taxable. They are to be used to provide employees with greater transparency into overall health care costs.

For a copy of Notice 2010-69, please go to:

A more detailed update can be found at:,,id=228881,00.html

Please contact your PS&F Benefits Team if you would like additional information.

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Vote ‘Yes’ for Initiative 1082

I just returned from a business conference in Washington DC. In all my travels, this is the first time I have spent more than a few hours here, and although I didn’t get the chance for serious exploring, I was able to take in some of the sites.

The discussions around politics today often center on the frustrations about the polarization, and resulting paralysis, that seems to have gripped the legislative process. Too often, key discussions tend to divide down party lines, with each side seemingly more interested in promoting or protecting political ideology than enabling legislation that will move the country forward.

A critical issue currently is increasing jobs, especially among small businesses. Small businesses are the heart of the US economy. Small business employs the majority of Americans and pays the majority of taxes. This year’s November 2 election in Washington State has a number of critical initiatives being put before the voters that could have dramatic impact on jobs and the small businesses that create them. One in particular is important to me and to Parker Smith & Feek. Washington State’s Initiative 1082 would end the Department of Labor & Industries monopoly on workers compensation. I support the initiative and urge you to seriously consider the issues.

Washington is one of only four states in the country that does not allow private insurance companies to compete with a state-sponsored fund in providing workers compensation coverage. To put this in perspective, PS&F provides our Washington clients with property, auto, liability, healthcare and many other kinds of insurance coverage – but not workers compensation. By contrast, our Anchorage office provides a full range of services, including workers comp, and is able to serve all our client’s needs there.

The ‘no’ side in the 1082 debate would have you believe that if the initiative passes, insurance companies will take advantage of injured workers in Washington and not pay claims. There isn’t any evidence to remotely suggest this is true. As I mentioned, 46 states currently operate with an open competition system and insurance companies pay millions of claims each year. The best systems exist where there is a strong state fund option as well as private insurance and where competition has made everyone better. These programs are characterized by excellent safety education and strong claims management, with the result being fewer serious injuries, injured workers being returned to gainful employment more quickly, and lower workers compensation rates for everyone.

Unfortunately, the debate over Initiative 1082 is predictably falling down party lines. This should not be a D v R issue, but should be about what creates a healthy, vibrant environment for employees and employers – especially small businesses. A vote for 1082 will create much needed competition and will inevitably improve the operations of L&I’s State Fund. Government isn’t the problem, per se, and certainly government isn’t evil. But government is best at oversight and regulation, ensuring that the rights of all are protected. The proposed legislation will maintain government’s appropriate role as a watchdog and will allow them to continue to compete in the open market.

Please, consider a ‘YES’ for Initiative 1082, and let the competitive marketplace drive innovation and cost reduction, making Washington a better environment for business and jobs.

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An eye opening opportunity

Last week, on September 24th, 16 individuals from Parker, Smith & Feek’s Bellevue office participated in the King County United Way Day of Caring, partnering alongside industry friends, Alaska National.

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Join us for Parker, Smith & Feek’s first ever Health Reform Tweet Chat

On October 6th, 2010 Parker, Smith & Feek will be hosting its first ever Health Reform Tweet Chat.

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Healthcare Reform Hits Main Street

The following video from the Henry J. Kaiser Foundation provides a good overview of the Healthcare Reform Legislation. Though some of the content can be debated, we think this is a good primer and we welcome you to contact us to discuss it.

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Get motivated by using Social Media

One of our employees was telling me today, how he uses Twitter to log his training for an upcoming Marathon.

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