February 15, 2008 (LANSING, MICH.) — After working diligently over 13 years as a private company to establish a national foundation for its business, Lansing-based Accident Fund Insurance Company of America said that now is the time for the Michigan Legislature to remove statutory limitations on its business that are keeping it from competing nationally.

“We are a proud Michigan employer, committed to staying here with our new national headquarters on the Lansing waterfront and the hundreds of new jobs it will bring. With reform, we will have the potential to grow many more jobs in Michigan for years to come,” said Elizabeth Haar, Accident Fund CEO.

Accident Fund is a wholly-owned subsidiary of Blue Cross Blue Shield of Michigan (BCBSM).

Legislation currently before the Michigan Senate (House Bills 5284 and 5285) removes a 13-year-old provision in Michigan law that limits Accident Fund to selling workers compensation insurance. The provision was put in place when BCBSM bought Accident Fund from the State of Michigan in 1994. The changes would allow BCBSM subsidiary companies to market other property and casualty lines of insurance. These include:

• Life
• Property
• Auto
• Marine
• Disability
• Casualty
• Surety and Fidelity

“Workers compensation is a property and casualty product, and our competitors across the country can package additional P&C products for their customers, such as liability or fleet auto,” Haar said. “Michigan law prohibits Accident Fund from providing a full array of products to meet our customers’ needs, and this puts our company at a competitive disadvantage in the national marketplace.”

Facts on Accident Fund

Accident Fund has a unique approach to its business model. The philosophy focuses on quality care, keeping employees safe, reducing costs and losses for employers, and most of all protecting customers today and in the future. Taking this philosophy to other lines of insurance in the national market will allow Accident Fund to grow its business here in Michigan.

Accident Fund has seen solid growth in the Michigan workers compensations market. Currently they have a 26% market share in voluntary commercial business. Accident Fund has less than 2% Michigan market share and .15% nationally, if all P&C insurance lines are considered. There is a tremendous opportunity for continued growth if Accident Fund is able to compete on the same level as the other national carriers.

“Accident Fund has a proven track record of bringing jobs back to Michigan through growth of our business,” Haar said. “In 1999 Accident Fund employed 380 people in Michigan. Having the ability to diversify nationally has grown our employee base to over 650 people, some in the field, but most in Michigan. Since our national expansion in 2000, approximately 350 of over 650 employees support our national business from our Michigan office.”

Even with reform, Accident Fund will still go through the same process as other insurers in order to receive authorization to sell multiple lines of insurance. The company would like the restrictions removed to be able to operate like all other property and casualty carriers.

“If Michigan is going to create great jobs in the new economy, we need to update laws that were written for the old economy—laws that restrict the national competitiveness of Michigan companies that pay state and local taxes and grow jobs in our local communities,” Haar said.

Headquartered in Lansing, Michigan, Accident Fund is one of the nation’s leading workers compensation insurers, operating in 43 states and the District of Columbia. The company also provides third party administration services and disability management. Founded in 1912, Accident Fund is rated “A” (Excellent) by A.M. Best and is a wholly owned subsidiary of Blue Cross Blue Shield of Michigan. More information can be found at www.accidentfund.com.

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