The Compensation Advisory Organization of Michigan (CAOM) is a private, not-for-profit association of insurance companies who are licensed to write workers compensation insurance in the state of Michigan. It was created in its current form on January 1, 1983 to collect, process and analyze workers compensation insurance premium, loss and other policy and claim data for member companies and state regulators. The CAOM has been the Designated Advisory Organization in Michigan for over three decades. This designation is maintained under a Memorandum of Understanding between The State of Michigan Data Collection Agency and the CAOM.
Among its primary duties, the CAOM develops market information for its membership related to the proposed advisory pure premium’s underlying the rates in the marketplace, and submits this information to the Data Collection Agency. It also promulgates policy experience modifications for member carriers under their filed Experience Rating Plan. The CAOM is continually looking to develop new products and services by leveraging technology that will provide value to its members, or enhance current offerings to increase efficiency or be more cost-effective solutions.
The CAOM’s sister organization is the Michigan Workers Compensation Placement Facility. The Facility is the market of last resort for employers who are statutorily required to have workers compensation insurance for their employees. It administers the process of policy assignment to the selected servicing carriers of the workers compensation assigned risk pool.
The CAOM’s revenues are derived solely from membership fees, quarterly assessments based on member market share, and revenue generated from certain products and services. No state money is used to fund its operations.