Workers’ Comp: What’s Ahead?

The workers’ comp industry hasn’t had a profitable underwriting year since 2006, according to Conning Research & Consulting. And while the economic recovery and rate increases will boost premiums, Conning expects—just as in recent years—rising medical costs and the increased utilization of drugs to re-introduce the threat of inflation in loss costs and reduce profitability even further. The firm’s recent report, “Workers’ Compensation: A Bumpy Road from Recession to Recovery,” indicates that the line has been affected by falling investment yields, creating headwinds against overall profitability.