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Navigating Workers' Compensation & Self-Insurance: Industry Prognosis

Explore key industry drivers, cost factors, and economic outlook in workers' compensation and self-insurance presented by Steven Weeks of AmFed in April 2019. Gain insights on historical perspectives, internal and external examinations, industry prognosis, and a triage plan for efficient operations.

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Navigating Workers' Compensation & Self-Insurance: Industry Prognosis

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  1. MS Workers’ Compensation & Self-insurance: A Prognosis of the Industry Presented by Steven Weeks AmFed April 2019

  2. Triage Plan • Setting the Tone – a historical perspective • Vital Signs • Internal Examination • Loss dollar • Rate adequacy • Expense load – or cost of production including excess • External Examination • Competition • Medical Costs • NCCI • Legal Environment • Prognosis - ?

  3. Initial Assessment

  4. The Loss Dollar Indemnity and Medical

  5. Rate AdequacyCombined Ratio Workers’ Comp Private Carriers

  6. Expenses – a key driver • On average the commercial insurance industry is operating at a 25% - 32% expense load. This leaves 60% of the premium dollar to pay claims and 8% -15% profit margin. • Expenses • Underwriting, claims, risk management • Ancillary costs and services – accounting, actuarial, taxes, fees and other expenses • Acquisition costs/commissions • Excess coverage • As an industry, are we efficient?

  7. Industry Drivers

  8. Policyholder Surplus$781.5 Billion (all time high)

  9. Cost Drivers

  10. Mississippi Historical NCCI Loss Cost Changes by Year

  11. Regulatory and Legal

  12. Economic: Is a recession imminent?

  13. Outlook • Commercial market • Profitable results continue to be published. • Policyholder surplus at historic levels. • Cumulative rate change of -48.1% since 2009. • Full-employment concerns. • Longest economic expansion since WWII. • Yield curve inversion. • Recession on the horizon?

  14. Treatment Plan

  15. Our Mission • Our Mission is to place the best interest of our customer first and conduct all our business in a highly professional and ethical manner. • Our most valued asset is our reputation. We believe that nothing can be gained slower or lost quicker, so we strive, every day, to maintain this accomplishment.

  16. Partnering with AmFed • AmFed is committed to providing a superior workers’ compensation product to both the commercial and self-insured industries: • Competitive Rates and Pricing • Multi – State Coverage options • A.M. Best A- rated      • Digitally Savvy • Online payments, safety courses and claims extranet for insureds • Online quoting and accessibility for agents

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