Ohio Workers’ Compensation and TPA History

A constitutional amendment was passed by Ohio voters in 1911 creating a voluntary workers’ compensation program for employers.  In this new system, the employer paid 90% of the workers’ compensation premium and the employee paid the other 10%.  After the first year, nearly 4,000 employers subscribed to the program protecting over 300,000 employees with over $1.2 million in premium collected.  In 1913, the Ohio Industrial Commission was formed. 

Compulsory Law was established in 1914 which created provisions for semi-annual readjustments of rates and gave direction to establish a substantial surplus and maintain rates at as low a level as possible.  Over 15,000 employers subscribed to the program that year collecting over $2.8 million in premium.  By the early 1920’s two more departments were added:  Industrial Relations and Industrial Safety & Hygiene.

As Ohio law continued to develop and add to their regulatory burden, employers needed assistance to ensure their interests were secured in managing and controlling costs of workers’ compensation claims.  In 1923, Emile E. Watson (former Actuary for the state of Ohio) was approached by 25 major Ohio employers to help understand the changes in the law and he formed the first third party administration organization in the state named The Emile Watson Company.

In almost 100 years (1911 – 2010) since workers’ compensation insurance was established in the state of Ohio, over 240,000 employers participate today with around $1.75 Billion premium collected annually.  With increased participation and continued changes in law through the years, the Third Party Administration industry has grown to nearly 100 organizations operating in Ohio today.