Montana’s workers and Montana State Fund.
Montana is built on strong, resilient, determined workers. Protecting them protects our way of life here. We take that responsibility seriously and personally. Because we’re Montana workers too.
Montana State Fund is different from other workers’ compensation insurance companies.
We’re what’s called the guaranteed market, which means that we insure Montana businesses no matter what. We estimate approximately 73% of MSF’s policyholders, due to policy size, risk or loss history, would potentially be put into an assigned risk plan. That equates to approximately 18,000 Montana employers. Assigned risk plans are more expensive than the voluntary market, have lower quality customer service and place less emphasis on workplace safety results.
Our role as a guaranteed market means more affordable and more stable rates across our entire policyholder mix. Private insurers can pick and choose which businesses they want to insure—often choosing the most profitable businesses—and bring constant change.
We’re also different because we’re uniquely dedicated to Montana. Other insurers can move in and out of the state, based on opportunity in the country. We’re locally managed and run – rooted here and conducting business based on what’s happening here. When our customers call us, they’re calling someone in Montana.
While we operate differently from other insurance companies, continuing to do our job for Montana means evolving as our world does the same. To stay competitive, we must search out new and more cost-effective and efficient ways to serve our customers and put them in place quickly. Business demands it. Montana needs it. Read on for info about the issues currently impacting our service to our policyholders. We’d love your support.
This is our policyholder information and engagement software. It keeps our customers current on workers’ compensation legislation that may impact them and informs them whether MSF is in support or opposition.
How Workers’ Compensation Works
See the specifics behind our partnership with businesses and the workers who power them.
Safety / Policy Rates
Work Comp 101
More MSF Videos
Safety / Policy Rates
Work Comp 101
Book by account size:
See how our policyholder mix – and primarily serving small businesses – keeps workers’ compensation insurance both affordable and high quality.
that pay less than $5,000 in annual premiums.
A Who’s Who of Montana’s Workers’ Compensation System
Several parties are involved in establishing and governing workers’ compensation insurance in Montana. Please click on a hexagon to learn more.
The Montana Legislature
Montana’s legislators determine workers’ compensation laws for the state. The Legislature meets primarily in odd-numbered years from January until the beginning of May. If a bill is passed by both of its chambers, it is sent to the governor.
The Executive Branch
Head of the executive branch, the governor can choose to sign a bill to make it law, veto it or allow it to become law without a signature. The governor also has an “amendatory veto” option, which allows for certain changes to a bill before sending it back to the Legislature for consideration.
The Judicial Branch
As with any law, the judiciary serves to hear, consider and rule on disputes. In addition to the courts of the judiciary, under the DOLI umbrella Montana has is a workers’ compensation court to handle disputes specifically related to claims for workers’ comp benefits. Appeals from the workers’ compensation court go directly to the Montana Supreme Court.
Hundreds of insurance companies, including Montana State Fund, are approved to sell workers’ compensation coverage in Montana. All carriers follow the same benefit structure and abide by the National Council on Compensation Insurance (NCCI) basic manual when selling policies.
Montana Department of Labor and Industry (DOLI)
DOLI regulates workers’ compensation benefits and ensures employers are compliant with workers’ compensation laws. The department also aids injured employees and provides mediators to assist in benefit disputes.
State Auditor’s Office, Commissioner of Securities and Insurance (SAO/CSI)
The SAO regulates policy enforcement and the certification of insurance companies. SAO is also responsible for the overall regulation of insurance companies in Montana.
National Council on Compensation Insurance (NCCI)
The NCCI is an independent advisory organization appointed by SAO to gather data, analyze industry trends and provide objective insurance rate and loss cost recommendations.1
1. National Council on Compensation Insurance, “About NCCI,” May 20, 2022, NCCI.com, https://www.ncci.com/Articles/Pages/AU_NCCIFactSheet.pdf, accessed October 31, 2022.
The best gauge of the job we’re doing for Montana is our policyholder satisfaction.
Timely claim management
(The law allows 14.)
A Future Worth Protecting:
See the path to more sustainable work in our state, now and in the future.
In 1915, Montana became one of the earliest states to pass a workers’ compensation act. The history of work and our collective identity in tackling the tough jobs fearlessly is unquestionable. Fast forward several decades, and by the 1980s, workers’ compensation insurance premium rates were driven by the political process. The result was the cost of claims increasing beyond the premiums charged…and an unfunded claim liability of more than $500 million. Private carriers left the state, giving Montana businesses even fewer options for their workers’ compensation insurance. Once it became clear that the structure was no longer sustainable, the Montana Legislature intervened.
An upside-down systemJuly 1987
- Legislature enacts payroll tax of 0.3% because of the unfunded liability in the State Fund, aka the “Old Fund.”
Change on the horizonJune 1989
- Legislature approves transfer of $20 million from the General Fund to a workers’ compensation tax account, but unfunded liabilities continue to grow without a change to underlying rate inadequacy.
An innovative new modelMay 1990
- Legislature separates the liability into claims happening before July 1, 1990 (“Old Fund”) and after July 1, 1990 (“New Fund,” now MSF). Old Fund liabilities are funded by an increased payroll tax on employers and employees.
- MSF receives $12 million in startup funds, then becomes funded solely by insurance premiums and investment income from premiums.
Safety takes the stage1993
- Legislature passes the Safety Culture Act.
Accounting for the pastSeptember 1996
- MSF pays $103 million to the Old Fund in lieu of paying dividends to its policyholders. The transfer repays the $12 million startup funds and pays down Old Fund bonds.
Settling upJanuary 1997
- MSF transfers $63.8 million to the Old Fund, including the repayment of the $20 million General Fund transfer of 1989.
Proof of conceptDecember 1998
- Payroll tax ends as Old Fund meets the criteria to be considered “adequately funded.”
- MSF declares its first-ever dividend to policyholders in the amount of $10 million. As workers' compensation claim costs stabilize and investment returns are realized, MSF returns $306 million in dividends to insured Montana employers.
- Special session transfers $4 million of Old Fund excess to General Fund.
Solidifying the modelJanuary 2003
- Interim committee studies the structure and role of MSF and makes recommendations to the Legislature.
- $18.2 million plus an additional $800,000 of Old Fund excess is transferred to General Fund (with the $4 million added in 2002) for a total of $23 million.
A secured futureJanuary 2005
- Legislative liaisons to the MSF Board of Directors determine there will be no sale of MSF and maintain the current structure as an independent not-for-profit public corporation and competitive state fund to be the guaranteed market for Montana businesses.
The economics of safety2007
- MSF launches “Work Hard, Be Safe” campaign to celebrate Montanans’ worth ethic and encourage the development of a safety culture in Montana.
Educating young workers2010
- “No Jack” TV and social media campaign tackles the job of helping young workers take safety seriously.
- Old Fund assets are depleted and the General Fund begins paying Old Fund Claims and administration costs.
- MSF Board adopts a 20% average decrease in rates due to the passage of HB334, a workers’ compensation reform bill.
Reaching a new generation2014
- MSF begins using new channels, including a popular YouTube video series, to raise awareness about safety and educate workers.
Ensuring a future of protectionJanuary 2015
- Regulatory oversight for MSF is transferred from the Legislature to the State Auditor’s Office (SAO).
A major milestone2015
- MSF marks the 100th anniversary of the Workers’ Compensation Act with a campaign honoring workers around the state.
Recognized leadershipJuly 2016
- SAO begins review and approval of MSF rates. The Montana Commissioner of Securities and Insurance approves MSF rates as adequate, not excessive, and not unfairly discriminatory.
A greater reach2017
- Legislature requires Montana Board of Investments to transfer up to $30 million ($15 million each year) of MSF assets to the state’s Fire Suppression Fund.
- MSF launches Growing a Safer Montana to emphasize to young workers the importance of workplace safety. The program has two primary components: 1) provide PPE grants to Montana senior high school industrial arts classes, and 2) provide scholarships for higher education to students entering trades and industries or industrial arts career paths.
- MSF’s premium rates reach the lowest level in history. Rates are more than 50% lower than they were at the peak rates in the early 1990s.
Honoring champions statewide2019
- MSF’s WorkSafe Champions program graduates its 300th business. The “Safety Works Here” campaign conveys the success of safety efforts on workplace culture across Montana.
Living our mission2020
- During the COVID pandemic, MSF staff packs and ships over 500 boxes of personal protective equipment (PPE) to frontline policyholders and their employees.
- MSF launches WorkingForMontana.com to showcase the organization’s mission, economic impact and commitment to a safer Montana workforce.
Expanding safety resources2021
- SafeMT.com relaunches with updated and expanded safety education tools for employers and employees across the gamut of Montana industries.
- MSF’s Growing a Safer Montana personal protective equipment (PPE) program expands its reach to supply safety gear to middle school industrial arts classrooms, in addition to senior high classrooms.
Find answers to your questions about our structure, operations, the dollars and more.
MSF is Montana’s largest workers’ compensation insurance company, insuring approximately 24,000 businesses, nonprofits and other organizations – and their workers. We are an independent, not-for-profit public corporation that operates solely on policyholder premiums and the investment returns on those funds. Contrary to the suggestion of our name, MSF is not a state agency and does not receive an appropriation of taxpayer dollars. Our mission is to partner with employers and their employees to care for those injured on the job and to champion a culture of workplace safety for our fellow Montanans.
As the guaranteed market, MSF offers coverage at a reasonable price to all employers that are required to have workers’ compensation insurance. To find out more, call us at 1-800-332-6102 or talk to your insurance agent.
Rates and dividends are two distinctly different things. In short, Montana law requires MSF to establish premium rates at a level that is sufficient to cover the cost of claims to maturity and the administrative expenses of MSF. These rates must be set at least annually at a level sufficient to ensure the adequate funding of the insurance program.
Dividends, which are not guaranteed, are funded as a result of favorable operating results, which include the investment returns on funds set aside for past claims. When operating results are better than expected and investment income exceeds what is needed to pay claims, as well as provide an appropriate level of policyholder equity, these funds can be shared with insured employers in a dividend. Because investment returns can vary widely from year to year reducing MSF rates in lieu of a dividend would cause MSF rates to be volatile, which is detrimental to Montana employers that rely on stability and predictability in conducting their affairs.
Furthermore, the general dividend allows MSF to reward those customers that have demonstrated a focus on safety and have managed their results. In short, it pays to operate a safe and healthy workplace.
It is worth noting that MSF actually has reduced rates while still distributing dividends. MSF has not raised rates in the last 16 years, since 2006, and the Board of Directors has reduced rates by a total of 54% over that same period. Current rates are at the lowest level in the 33-year history of MSF – all while distributing record dividends to deserving policyholders.