National Underwriter

WORKERS’

COMP WATCH

THE CARRIER PERSPECTIVE: HOW AIG UTILIZES MEDICAL EXPERTS; A NEW PLAYER TAKES ON HARD TO-INSURE WC RISKS; AND THE HARTFORD ON WHY IT’S NOT JUST ABOUT GETTING RATE

BY CHAD HEMENWAY

It’s no secret that Workers’ Compensa- tion is a challenging line of business, to say the least—carrying an annual industry combined ratio well into un- profitable territory (117.2 in 2011— the highest in the last decade and the highest among all major insurance lines).

As the overall insurance market hardens, Workers’ Comp is among the lines consistently seeing the largest rate increases. But for years, this line has been severely underpriced—and so the industry is far from digging itself out of that hole, despite the recent rate hikes. Nevertheless, Workers’ Comp premiums for private carriers and state funds increased to $35.67 billion in 2011—a 13. 3 percent jump from 2010 and the first increase since 2006, according to SNL Financial.