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About State Compensation Insurance Fund

From San Diego in the south to Eureka up north, State Compensation Insurance Fund (State Fund) keeps workers in the Golden State covered. Run like a mutual company, State Fund is a not-for-profit, public enterprise fund. Its primary product is workers' compensation insurance but the company also offers claims management, coordinated care plans, and loss control services to policyholders. Employers can purchase coverage directly from the insurer or through independent brokers. It boasts some 130,000 policyholders. As the insurer of last resort, the independent State Fund was established by the California legislature in 1914.


While it operates in a self-sufficient manner, the company's board of directors and chairman are appointed by the governor of California. The company has some 130,000 policyholders; many of its clients are small and new businesses.

In addition to workers' compensation coverage, State Fund offers accident prevention services and return-to-work programs at no extra cost.

Geographic Reach

Customers can contact State Fund representatives at offices stretching from Eureka to San Diego.

Sales and Marketing

State Fund provides sales, marketing, and support services through its offices located across the state. Its branch locations employ claims adjusters, loss-control representatives, ergonomics specialists, and industrial hygienists.

Financial Performance

Net sales increased by 53% to $1.6 billion in 2014. However, incurred losses and loss adjustment expenses led to a slight decrease in net income, which fell 1% to $37.1 million. Cash flow from operations also dropped, slipping 53% to $185.8 million as a result of changes in benefits and loss-related payments.


Despite its status as a quasi-public business, State Fund employees are considered state civil servants and as such have been vulnerable to California budget crunches and cuts in the last few years. Overall, the company expects its cost-control efforts to allow it to maintain fair pricing standards and therefore serve a larger portion of the workers' compensation market in California. Efforts to attract new business include offering group discounts, merit rating plans, claims-free credits, and low-premium plans for select customers. It has also enhanced its online service offerings.

In 2014 continued making moves to strengthen its financial position. For example, it increased its overall loss and loss adjustment expense reserve position by $250 million. It also continued its recently implemented tiered rating system, which was designed to allow more accurate policyholder risks, thereby making the firm able to offer fair pricing to more employers. (Upon evaluation of this structure, State Fund discovered that its group discount program was redundant, so it discontinued that plan.)

Also in 2014, State Fund began providing free training for its in-network physicians to offer alternatives to opiod prescriptions in the treatment of pain.

Company Background

State Fund has undergone a number of leadership and board changes in recent years following investigations into conflict-of-interest reports. An sweeping internal review begun in late 2006 revealed conflict-of-interest at several levels of the organization and prompted the resignation of two directors and State Fund's president James Tudor. (The firm has gone through several CEO since then.) A multi-agency criminal investigation was also launched as a result of its findings; that investigation was closed in 2011 without any charges filed against the company.

State Compensation Insurance Fund

333 Bush St FL 8
San Francisco, CA 94104-2806
Phone: 1 (888) 782-8338

Firm Stats

Employer Type: Privately Owned
Chair: Sheryl A. Chalupa
Chief Claims Operations Officer: Beatriz Sanchez
President and CEO: Vernon L. Steiner
Employees (This Location): 75
Employees (All Locations): 4,300

Major Office Locations

San Francisco, CA

Other Locations

Bakersfield, CA
Eureka, CA
Fresno, CA
Glendale, CA
Monterey Park, CA
Oakland, CA
Oxnard, CA
Pleasanton, CA
Redding, CA
Riverside, CA
Sacramento, CA
San Diego, CA
San Jose, CA
San Luis Obispo, CA
Santa Ana, CA
Stockton, CA
Vacaville, CA