Workers’ Compensation Sees Underwriting Profit in 2015
Fitch Ratings recently released a report stating that Workers’ Compensation insurance in the U.S. generated a significant profit in 2015. This growth is not expected to last very long, however, according to Fitch, as the rating company indicated that by 2017 we will be seeing an underwriting loss once again due to the competition that has heated up in the space.
“The Workers’ Comp insurance market saw a sharp turnaround in the last few years due to past premium rate increases, stable loss cost trends and improved loss reserve experience, however, this performance will likely be unsustainable as price competition intensifies due in part to abundant market capacity,” said Jim Auden, Managing Director, Fitch.
The Fitch report indicates the segment underwriting combined ratio dropped from a recent cyclical high of 117% in 2011 to 95% in 2015. Premium revenue growth tapered more recently, but averaged more than 5% for the last three years and was 3.5% in 2015. In the recent economic recession, Workers’ Compensation, says Fitch, business suffered from weak pricing and significant declines in segment premium volume. The underwriting response to 2010 and 2011 losses, combined with improving economic conditions, led to a sharp increase in written premium volume for the segment.
Caitlin Morgan has been consistent throughout all market cycles in providing Workers’ Compensation solutions to clients. Our solutions range from guaranteed cost coverage for small businesses across many different industry sectors, to self-insurance programs for larger employers, to specialized Comp plans such as the one we created for the Indiana Health Care Association (IHCA), HOPE, and Leading Age Indiana associations. Through this program, we along with RTW, provide nursing home members with coverage along with dividends, tailored loss prevention, lower claims costs, and fast claims resolutions.
Our staff has been specializing in Workers’ Comp for years and has distinct advantage because of our strong underwriting expertise, claims management and loss prevention, and ability to place good business at a fair price. We can assist you with your clients’ Workers’ Compensation needs, ensuring that you will have a home for this line of business through the ups and downs of market cycles. Give us a call at 877.226.1027.