NCCI held its 2015 Annual Issues Symposium in Orlando this week. The industry event is a major draw for workers’ comp leaders across the nation. During his State of the Line 2015 report, NCCI (soon to retire) CEO and President Steve Klingel warned against complacency in the face of good results. According to Insurance Journal coverage, Klingel’s message was clear: “The most recent results show that 2014 was a good year for the industry—and that follows solid results in 2013,” he said. “It would be great if these results marked the beginnings of a new trend line, but ours is a business that runs in cycles. And despite the current calm conditions, we are anticipating turbulence ahead.” The stated reasons for the “turbulence ahead” were increasing claim severity on both the medical and indemnity sides, a persistent low interest rate environment, and stubborn employment totals in construction and manufacturing that have still not bounced back to pre-recession levels. Klingel also identified qualitative challenges to the line including exclusive remedy attacks and changing workplace environments.
Overall, the workers’ compensation calendar year combined ratio for private carriers was 98 in 2014, a four point decrease from 2013. Total market net written premium increased by approximately 6 percent to $44.2 billion, driven primarily by an increase in payroll.