Industry concerned about health of workers' comp system

Other top concerns included medical inflation and economic uncertainty. (Credit: Lightfield Studios/Adobe Stock)

Industry stakeholders say their top concern is the financial health of the workers’ comp system, according to a new study from the National Council on Compensation and Insurance (NCCI).The survey, now in its 24^th year, asked more than 100 workers’ compensation executives about the topics they’re most worried about going into 2025. NCCI says concerns about the financial health of the system have been part of carrier feedback for years, underscoring its importance.Despite executives’ concerns, however, NCCI says all current metrics point to a strong workers’ comp system. Combined ratios have been below 90% for nearly a decade, and preliminary data suggests 2024 will be the same.Combined ratios have been low due to three main factors: growing wages, milder workplace injuries and a long-term decline in claims per employee. In states where NCCI provides ratemaking services, workplace injury claims have been decreasing over the last 20 years, thanks largely to safety improvements and increased automation.Executives said their other top concern is medical inflation, as healthcare costs continue to rise.NCCI says medical inflation has a more moderate impact on workers’ comp than it does elsewhere. State-mandated fee schedules put limits on workers’ comp payments to healthcare providers. They also control how much those payments can change from one year to the next. NCCI says medical inflation’s impact on workers’ comp is currently in the range of 2.5% to 3.5%.Other concerns in the survey included economic uncertainty, the changing workforce and workplace, the evolving legal and regulatory landscape and the legalization of medical marijuana.“Each year, our Carrier Executive Survey captures the pulse of the industry and helps us pinpoint key issues facing workers’ compensation stakeholders,” said Bill Donnell, president and CEO of NCCI, in a statement. “NCCI is dedicated to staying ahead of emerging trends and equipping stakeholders with data and insights to make informed decisions for the future.”See also:

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