There were some positives and negatives for the workers compensation insurance market in the annual Ã¢â‚¬Å“State of the LineÃ¢â‚¬ report from NCCI Holdings Inc.
On the plus side, written premiums saw growth for the first time since 2005, indicating that the worst of the recession is over.
Net written premiums (including state funds) increased by 7.4 percent to $36.3 billion, a welcome shift following the cumulative 27 percent decline in premium from 2006-2010, NCCI said.
However, for the third straight year, workers compensation holds the distinction of having the highest combined ratio of all the major commercial lines.
NCCI reported that the workers compensation calendar year combined ratio was 115 in 2011, the same number as in 2010.
In a release, NCCI Chief Actuary Dennis Mealy observed:
Workers compensation, because of its direct connection to employment and the labor markets, has been the property/casualty line most significantly impacted by the continued difficult economic environment. Combined ratios remain at unsustainably high levels, and investment returns are not sufficiently high to generate operating returns near the cost of capital.Ã¢â‚¬
Despite the challenges, NCCI added that the industry is well-capitalized for the future.
Business Insurance has more on this story.
Check out I.I.I. information on workers compensation.