National Council On Compensation Insurance Inks Agreement With Insurance Services Office to Resolve Outstanding Legal Battle

Business Wire, May 7, 1999

BOCA RATON, Fla.--(BUSINESS WIRE)--May 7, 1999--

The National Council on Compensation Insurance (NCCI) and Insurance Services Office, Inc. (ISO) jointly announced today that they had signed a nationwide agreement that provides for NCCI to license its intellectual property to ISO.

The agreement ends a legal dispute between NCCI and Insurance Data Resources, Inc. (IDR), now an ISO subsidiary, that began in 1996, when NCCI filed a federal lawsuit against IDR alleging copyright infringement.

"We're very pleased to reach an agreement that benefits our customers and serves the best interests of the workers compensation community," said Fred R. Marcon, ISO's chairman and chief executive officer. "The agreement promises significant benefits to the industry by preserving the required uniformity unique to workers compensation insurance."

The agreement covers statistical and rating plans, policy forms, manuals, loss costs and rates. Statistical plans are the uniform methods insurers use to record and report statistics through state-appointed statistical agents to state insurance regulators. Rating plans are the methods, generally approved by state regulators, used to calculate insurance rates for classes of risks or individual risks.

"NCCI continues to be willing to make our manuals, classification systems, databases and other resources available as long as others are willing to share equally in their cost and maintenance. Both sides have worked very hard to achieve an agreement," said Bill Schrempf, NCCI's president and chief executive officer. "We have both made some tough choices because we know that this agreement is in the best interests of all workers compensation stakeholders - regulators, insurers and employers."

ISO conducts its operations for workers compensation through its subsidiary for that line of insurance, IDR, which ISO acquired last year.

The license term is perpetual and applies to all states in which IDR is licensed to provide workers compensation services. Under the agreement, ISO retains the option to develop its own alternative materials and can, if it chooses, reduce the scope of the agreement on an individual product license or state basis.

Under the agreement, ISO acknowledged the NCCI's copyright of the materials for the term of the license, and the NCCI agreed to withdraw its lawsuit and not seek to reinstate it for any alleged past infringement.

For further information, contact James Wolfe, NCCI Chief Communications Officer at 561-997-4749 For ISO, contact David Ostwald at 212-898-6601.

NCCI, a shared-services organization serving the workers compensation industry, offers a comprehensive array of services that enables insurers and other stakeholders to access and use workers compensation data to establish accurate loss costs, calculate experience rating modifications, manage residual market mechanisms and reduce its overall costs. For additional information, visit our website: www.ncci.com.