Focus on 5: Top Challenges for the Workers Compensation Industry
Every year for the past decade, the National Council on Compensation Insurance (NCCI) has surveyed carrier executive leaders* in the workers compensation industry to better understand their market perspectives, needs, and challenges.
Key findings from NCCI’s survey of 109 insurance company leaders are included in our Focus on 5—a list of top carrier concerns viewed as impactful to our industry.
2019 Focus on 5 Topics
This year’s Focus on 5 is made up of familiar, interrelated topics from years past:
Adapting to the Changing Workforce and Workplace
What they said: More than half of insurer executives interviewed saw adapting to the changing workforce and workplace as a challenge for 2019. They expressed concern not only over new and changing risks associated with an aging workforce, unskilled workers, independent contractors, and new technology, but with assessing these and other unknown risks.
What they’re doing: Insurers spoke of addressing these changes through underwriting and analytics, by developing new products, and by adapting pricing and underwriting. Some mentioned reaching out with public campaigns and employer education programs to promote a safer workplace.
Maintaining Profitability and Premium
What they said: Insurers are concerned about their ability to maintain profitability and premium levels that may be affected by changes in loss cost trends, legislation, and the economy.
What they’re doing: Many insurers are taking a hard look at premium levels and underwriting to remain competitive. Some are seeking opportunities to develop new products and new markets. Others are putting tighter controls on expenses and looking for greater efficiencies through technology.
Medical Costs, Advances, and Determining Appropriate Care
What they said: Medical costs, advances, and determining appropriate medical care are mentioned as major concerns and challenges by more than a quarter of the leaders interviewed. While rising costs remain a concern, insurers have somewhat “baked them in” to their expectations.
What they’re doing: Industry stakeholders closely monitor medical advancements to help maintain appropriate care for injured workers and improve return-to-work outcomes. Some insurers are introducing a variety of programs that go well beyond just paying for injuries, with an enhanced focus on workers’ overall health.
Political, Regulatory, Legislative, and Legal Environment
What they said: Insurers continue to be concerned about political volatility and the impact of new legislation. Compared to years past, however, there were fewer mentions of concern over federal involvement in the industry.
What they’re doing: The executives and their organizations stay close to the issues by monitoring legislative activity and working closely with trade groups.
The Future of the Workers Compensation Industry
What they said: Most of the challenges and concerns expressed going into 2018 remain relevant in 2019. The future of the workers compensation industry, opioid abuse and medical marijuana, and advancements in technology are all top of mind. New concerns for worker safety are tied to the hiring of more unskilled workers, distracted drivers, and the challenge of “under the influence” workers.
What they’re doing: More insurers are working to educate their stakeholders and the public on the benefits of workers compensation by highlighting how the industry has directly and indirectly influenced safer workplaces and better outcomes for injured workers.
NCCI Insights—Exploring Our Focus on 5
NCCI prides itself on fostering a healthy workers compensation system. NCCI’s research, publications, and events offer content that anticipates and responds to the needs of insurers, regulators, and other key industry stakeholders.
Throughout 2018, NCCI addressed many of the challenges and concerns that make up this year’s Focus on 5:
Maintaining Profitability and Premium
Medical Costs and Advances
Political, Legislative, Regulatory, and Legal Environment
The Future of Workers Compensation and Related Topics
NCCI plans to expand on its Focus on 5 topics and more at its
Annual Issues Symposium 2019—Powered by Insight, May 13–15, in Orlando. We hope to see you there!
Visit NCCI’s recently enhanced
INSIGHTS portal at
ncci.com/INSIGHTS for additional information and to access the full inventory of the organization’s research.
*NCCI’s Annual Carrier Executive Study is conducted by an independent survey provider. Interviews are conducted with Workers Compensation Insurance Carrier or State Fund executives and senior managers. The 2018 interviews that contributed to these 2019 results reflect responses from 109 such leaders.
This article is provided solely as a reference tool to be used for informational purposes only. The information in this article shall not be construed or interpreted as providing legal or any other advice. Use of this article for any purpose other than as set forth herein is strictly prohibited.