The declining premiums and rough economy that have forced Florida companies to reduce their workforces have created a perfect storm for agents. These external forces, combined with the 2003 reforms, have resulted in declining workers' compensation insurance premiums over the past four years, with another major drop on the horizon. The National Council on Compensation Insurance (NCCI) has filed for a statewide average rate decrease of 18.6 percent in workers' compensation rates.
Lower premiums are a boon to employers, but result in reduced agency revenue and commissions. They also give employers more of an incentive to shop for price, to further commoditize workers' compensation insurance programs.
In the midst of this “perfect storm,” brokers have an opportunity to expand their value to their clients. Aggressive agencies are developing fee-based revenue streams, offering services that attack the real cost drivers of claims, and becoming valued consultants to employers.
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