{"id":3102,"date":"2025-10-08T16:00:31","date_gmt":"2025-10-08T16:00:31","guid":{"rendered":"https:\/\/beijingcareer.com\/?p=3102"},"modified":"2025-10-08T18:24:56","modified_gmt":"2025-10-08T18:24:56","slug":"strong-profits-continue-for-us-workers-comp-despite-pricing-cuts-am-best","status":"publish","type":"post","link":"https:\/\/beijingcareer.com\/index.php\/2025\/10\/08\/strong-profits-continue-for-us-workers-comp-despite-pricing-cuts-am-best\/","title":{"rendered":"Strong profits continue for US workers\u2019 comp despite pricing cuts: AM Best"},"content":{"rendered":"

The U.S. workers\u2019 compensation line of coverage remains a key driver of the profitability of property\/casualty insurance, although economic uncertainty may lead to some short-to-medium-term turbulence for insurers, according to a recent AM Best report.<\/p>\n

\"am-best-logo\"With a combined ratio of 88.8 in 2024, the lowest among the major P&C lines of business, U.S. workers\u2019 compensation remained profitable, the Best\u2019s Market Segment Report, \u201cWorkers\u2019 Compensation Continues With Strong Profits, Despite Pricing Cuts,\u201d stated.<\/p>\n

This was achieved even as net premium written for the industry fell nearly 7% due to rate decreases and pricing cuts. Midyear 2025 results show continued profitability, with a further decrease in premiums due to ongoing rate reductions, analysts noted.<\/p>\n

\u201cWorkers\u2019 compensation is the key line of business driving the profitability of the whole property\/casualty industry, and underwriting profits over the past decade have been largely attributable to favourable prior-year loss development,\u201d said Christopher Graham, senior industry analyst, Industry Research and Analytics, AM Best.<\/p>\n

He continued: \u201cWhile the reserve cushion appears to be shrinking, it is expected to provide benefits to calendar-year profitability in the medium term.\u201d<\/p>\n

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\"Ascot<\/a><\/div>\n<\/div>\n

California continues on the lead with the largest share of national workers\u2019 compensation premium, accounting for 20% of direct premium written in the United States – double that of any other state.<\/p>\n

Collectively, the top 10 states contribute more than 60% of the national premium. While the overall results in 2024 were strong, six of these top 20 states achieved even better outcomes, with statewide combined ratios exceeding the national average.<\/p>\n

\u201cAlthough workers\u2019 compensation has remained relatively unaffected by many of the factors leading to stress in other lines of coverage, which have produced more volatile year-to-year results, its payroll exposure base is susceptible to macroeconomic shocks,\u201d analysts explained.<\/p>\n

Adding: \u201cThe possibility of a recession, the impact of tariff and immigration policy changes and other challenges, including legislative changes, are possible headwinds for this line of business.\u201d<\/p>\n

The report also noted that the workers\u2019 compensation system will be less impacted by the recent increases in medical inflation in the overall economy, mainly because statutory payment schedules and different uses of physician services and pharmaceuticals limit the impact of unexpected inflation for workers\u2019 compensation claims.<\/p>\n

David Blades, associate director, Industry Research & Analytics, stated: \u201cA key question for the workers\u2019 compensation line is how much longer will rate and pricing declines continue and cause dissipating profit margins before insurers begin to hold the line on pricing, since, for many companies, workers\u2019 compensation profits help offset more uncertain underwriting results for other lines of coverage.\u201d<\/p>\n

The post Strong profits continue for US workers\u2019 comp despite pricing cuts: AM Best<\/a> appeared first on ReinsuranceNe.ws<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

The U.S. workers\u2019 compensation line of coverage remains a key driver of the profitability of property\/casualty insurance, although economic uncertainty may lead to some short-to-medium-term turbulence for insurers, according to a recent AM Best report. With a combined ratio of 88.8 in 2024, the lowest among the major P&C lines of business, U.S. workers\u2019 compensation […]<\/p>\n","protected":false},"author":1,"featured_media":930,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[12],"tags":[],"_links":{"self":[{"href":"https:\/\/beijingcareer.com\/index.php\/wp-json\/wp\/v2\/posts\/3102"}],"collection":[{"href":"https:\/\/beijingcareer.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/beijingcareer.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/beijingcareer.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/beijingcareer.com\/index.php\/wp-json\/wp\/v2\/comments?post=3102"}],"version-history":[{"count":3,"href":"https:\/\/beijingcareer.com\/index.php\/wp-json\/wp\/v2\/posts\/3102\/revisions"}],"predecessor-version":[{"id":3105,"href":"https:\/\/beijingcareer.com\/index.php\/wp-json\/wp\/v2\/posts\/3102\/revisions\/3105"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/beijingcareer.com\/index.php\/wp-json\/wp\/v2\/media\/930"}],"wp:attachment":[{"href":"https:\/\/beijingcareer.com\/index.php\/wp-json\/wp\/v2\/media?parent=3102"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/beijingcareer.com\/index.php\/wp-json\/wp\/v2\/categories?post=3102"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/beijingcareer.com\/index.php\/wp-json\/wp\/v2\/tags?post=3102"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}