Whats Ailing Workers Comp?
Anyone who has recently tried to purchase commercial insurance knows the surprise: Rates have skyrocketed. In simple terms, the commercial insurance industry is in the midst of what is called a “hard market,” meaning that the traditional competition-based price-cutting used by carriers to gain new business no longer exists. Instead, the focus is on raising rates to try to rebuild sagging profits. What’s behind the skyrocketing rates? There are a number of causes, all of which have come together at nearly the same time. The first is a general “correction” in the market. That is, insurance markets always go through hard and soft cycles, regardless of other factors. During soft markets, insurers tend to undercut prices for competitive reasons. Then, when a market turns hard, they must not only make up the losses but move into profitable territory. After a sustained soft market of more than 10 years, a correction has been occurring these last couple of years. Second, and one of the most im
