NCCI: Workers’ Compensation Claim Frequency—2014 Update
The downward trend in workers’ compensation lost-time claim frequency continues, albeit modestly. A new report from the National Council on Compensation Insurance (NCCI) says that preliminary estimates show a two percent decline in workers’ compensation lost-time claim frequency in Accident Year 2013.
Key Findings
According to preliminary estimates, lost-time claim frequency per premium for workers compensation declined by 2% in Accident Year 2013
From 1990 through 2009 claim frequency declined at an average rate of more than 4 percent per year.
Claim frequency increased 3.5 percent in Accident Year 2010, the first significant increase in frequency in 20 years.
Influenced by the Great Recession, frequency changes varied considerably by size of loss from 2008 to 2012. In Accident Year 2012, there was a sharp decline in the frequency of claims above $50,000.
From Accident Year 2008 through 2012, frequency per premium declined for all five NCCI major industry groups, most notably in the Office & Clerical Industry Group.
Frequency declines by NCCI type of injury were volatile in the low-frequency fatality and permanent total disability categories.
Frequency declines were greater than average for lower back and multiple body part injuries but lower than average for arm and shoulder injuries.
Employers in high-frequency per payroll classes select small deductibles more often than those in lower frequency classes.
Employers in the Contracting Industry Group, as well as employers in Hazard Group G (the most hazardous of the seven hazard groups), select small deductibles far more frequently than those in other industries.
In states that allow the use of losses gross of the deductible in experience rating, frequency per payroll was only slightly lower for employers that selected small deductibles than for those that did not select a deductible, after adjusting to a common industry mix.
In states that mandate the use of losses net of the deductible in experience rating, frequency per payroll was higher for employers that selected small deductibles than for those that did not select a deductible, after adjusting to a common industry mix.
A significantly greater number of employers select small deductibles in states that mandate the use of losses net of the deductible in experience rating.
Click here to learn more about the new NCCI update
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