The market for occupational injury insurance entered the new year in a favorable environment as signs of economic recovery continue to stabilize renewals, say market experts.
"Our prospects for the foreseeable future remain stable for most buyers," said Debbie Goldstine, Chicago-based Vice President of U.S. Accidents, Technical Intelligence and Emerging Risks at Lockton Cos. "There were signs of economic recovery in our renewals, and our wage forecasts for job renewals for the second half of the year were up about 5%."
In November, the National Council on Compensation Insurance published its 2021 Workers Compensation Financial Results Update, which assessed The combined ratio of private insurance companies to 87% remained strong and grew to a surplus of $ 1
AM Best & Co. revised its previous outlook for the US occupational injury insurance market for 2022 from negative to stable, noting an unexpected "dampening" effect that the covid-19 pandemic had on insurance companies' balance sheets and operating results.
The competitive market continues to report favorable combined ratios driven by consistent losses , according to AM Best's latest report, published in nove mber. Underwriting results deteriorated only slightly, benefiting from "less fraud, fewer workplace accidents, and lower defense costs." -based senior financial analyst at AM Bäst. The reason, he said, may be agents 'or brokers' reluctance to relocate accounts. . Mangano.
"Given the current competitiveness of the occupational injury compensation market, there are concerns that some insurance companies may begin to ease their terms or lower prices below adequate levels to maintain or attract business," he said.
And there are other potential countermeasures. factors for the market to look at in 2022.
Despite COVID-19's less-than-expected impact on the industry, "there are several cases developing around covid, including ligation of covid spouses at work and concentration of risk research," said Goldstine.
Prices observed in 2020 and 2021 will continue to fluctuate as other factors are involved, according to Coleman Johns at Bedford, Massachusetts-based chief underwriting officer for the US middle market at Liberty Mutual Insurance Co.
"Despite its general stability as an industry, there is definitely some volatility in the environment right now, especially with some key riables that directly affect workers' profitability such as interest rates, inflation, the economy and the recovery, unemployment and uncertainty associated with covid, says Johnson. what it means for market pricing as it may have been in the past, ”he said.
Historically low interest rates and wage inflation this year are likely to have an effect, Johnson said.
increase in the frequency of injuries in workers, said Mr. Johnson.
"Add to that an already positive degree of difficulty for th e line of medical and indemnity, and the rate of large losses that continue to climb, there is an increasing loss cost that we must keep pace with if we want a stable and healthy market in the future ", he said.
Other. Issues to look at among workers include an aging workforce, co-morbidity independent of covid-19 and the exclusive solution being questioned, which will continue to be monitored, Goldstine said.