While the economy is showing signs of improvement, workers' compensation could face different directional trends, resulting in a complex mixture of improvement and further deterioration, according to a new study by Conning Research & Consulting.
"The workers' compensation line of insurance saw its last year of underwriting profit in 2006," says Joshua Youdovin, analyst at Conning Research & Consulting. "The economic recovery and rate increases will boost premium, yet we expect that rising medical costs and increased utilization of drugs will re-introduce the specter of inflation in loss costs and reduce profitability even further."
Youdovin also notes that the line has been impacted by declining investment yields, which has created headwinds against overall profitability. While there are early signs of economic improvement, this could bring new surprises regarding risks and opportunities in the line.
Complete your profile to continue reading and get FREE access to BenefitsPRO, part of your ALM digital membership.
Your access to unlimited BenefitsPRO content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Critical BenefitsPRO information including cutting edge post-reform success strategies, access to educational webcasts and videos, resources from industry leaders, and informative Newsletters.
- Exclusive discounts on ALM, BenefitsPRO magazine and BenefitsPRO.com events
- Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com
Already have an account? Sign In
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
