NU Online News Service, Dec. 17,11:58 a.m. EST

Workers' compensation insurers and reinsurers are operating in a risky environment similar to the one in the late 1990s that "put a number of workers' comp [insurers and reinsurers] into the grave," according to a Moody's Investors Service report.

In its December "Reinsurance Monitor" report, Moody's referenced comments made by Liberty Mutual CEO Ted Kelly in November, when he described the workers' comp market as a ticking time bomb.

Moody's said while claim frequency has generally declined, the leaner economic times have led to injured workers returning to the workforce more slowly "because some don't have jobs to return to, and employers spend less money to support early return-to-work programs." Moody's said the longer workers stay on disability, the more often they seek additional medical treatment or sue, both of which increase claim costs.