NCCI has been pussyfooting around with this for he past two years in their annual updates state-by-state. They won’t come out and say,”Hey, you’re going to get your hat handed to you,” but reading between the lines, it’s a big problem.
Not really the NCCI’s business to pick winners and losers. When there are carriers who are writing below the lost costs in risky classes of business, it is the state DOI which should have oversight and question the business practice of individual carriers.
As a 50+ year veteran of the industry, my understanding of insurer’s complaints that they’re “losing money” is that they’re not making as much of a profit as they would like. So if anyone wants to believe that their numbers are real, go ahead and dream folks, and they’ll laugh all the way to the bank with your money in their pockets. They ony things that put companies in financial straits or bankruptcy, are very poor management (increasing market share as the only object) and somebody “stole” the cash.
What a sham. Carriers are still writing WC at premiusm grossly below what is profitable. And there are new carriers entering the Midwest on a regular basis, making the competition even tougher. Now we have Hartford and Traveler’s looking to write Work Comp unsupported, and aggressive. Something doesn’t add up. But the two big whores don’t start buying up WC like this unless they see opportunity.
Hartford and Travelers has been writing WC unsupported for YEARS, it’s nothing new. Hartford is also very profitable on wc for small business, unlike the industry so that is why they can be agressive
In workers comp you used to be able to write the business with no profit (or even at a loss) and still end up with a decent return because of the investment income earned from collecting the premium up front and then paying losses at a later date. With today’s low investment yeilds that is no longer an option. The fact that the industry had a combined ratio around 120 last year and is expected to do the same this year means something has to change. You can’t lose 20 cents for every dollar you collect and still remain solvent.
For years, carriers have been whoring around chasing after classes of business where they had historically avoided, or wouldn’t write on stand-alone basis. It’s the classic “dogs in the yard” scenario where the big dog (AIG/Chartis) was writing contractors and other lines no one else would write, and the market followed suit. Now it’s Reliance, Legion and Fremont General all over again.
Lot’s of funny stuff going on in Texas with the atates biggest writer. In the past 3 years they bought every piece of business they could buy. Stay tuned…this fiasco might be worth watching.
NCCI has been pussyfooting around with this for he past two years in their annual updates state-by-state. They won’t come out and say,”Hey, you’re going to get your hat handed to you,” but reading between the lines, it’s a big problem.
Not really the NCCI’s business to pick winners and losers. When there are carriers who are writing below the lost costs in risky classes of business, it is the state DOI which should have oversight and question the business practice of individual carriers.
oddly enough, the PA Compensation Rating Bureau has filed for an overal 5.56% rate DECREASE…ummm….”REALLY????”
As a 50+ year veteran of the industry, my understanding of insurer’s complaints that they’re “losing money” is that they’re not making as much of a profit as they would like. So if anyone wants to believe that their numbers are real, go ahead and dream folks, and they’ll laugh all the way to the bank with your money in their pockets. They ony things that put companies in financial straits or bankruptcy, are very poor management (increasing market share as the only object) and somebody “stole” the cash.
What a sham. Carriers are still writing WC at premiusm grossly below what is profitable. And there are new carriers entering the Midwest on a regular basis, making the competition even tougher. Now we have Hartford and Traveler’s looking to write Work Comp unsupported, and aggressive. Something doesn’t add up. But the two big whores don’t start buying up WC like this unless they see opportunity.
Hartford and Travelers has been writing WC unsupported for YEARS, it’s nothing new. Hartford is also very profitable on wc for small business, unlike the industry so that is why they can be agressive
In workers comp you used to be able to write the business with no profit (or even at a loss) and still end up with a decent return because of the investment income earned from collecting the premium up front and then paying losses at a later date. With today’s low investment yeilds that is no longer an option. The fact that the industry had a combined ratio around 120 last year and is expected to do the same this year means something has to change. You can’t lose 20 cents for every dollar you collect and still remain solvent.
For years, carriers have been whoring around chasing after classes of business where they had historically avoided, or wouldn’t write on stand-alone basis. It’s the classic “dogs in the yard” scenario where the big dog (AIG/Chartis) was writing contractors and other lines no one else would write, and the market followed suit. Now it’s Reliance, Legion and Fremont General all over again.
Does anyone know the real target margin that carriers are looking for including investment income?
Lot’s of funny stuff going on in Texas with the atates biggest writer. In the past 3 years they bought every piece of business they could buy. Stay tuned…this fiasco might be worth watching.