A somewhat macabre insurance story from CFO; large-scale layoffs in the US mean that there are “fewer workers around to get hurt.” Thus, workplace fatalities—and related workers’ compensation insurance claims—have fallen to historically low levels.
The story cites a recent release of data on workplace deaths, which fell by 17% last year to the lowest annual level since the Bureau of Labor Statistics began tracking this information in the early 1990s. The National Council on Compensation Insurance (NCCI) previously reported that the number of workers’ comp claims (covering both fatal and non-fatal injuries) fell by 4% in 2009.
As an insurance industry expert tells CFO, one factor in the fall—in addition to fewer workers and advances in safety—is that those who remain employed “fear that a claim could make their job more vulnerable.” For its part, the NCCI explains that “the lack of hiring [due to recession] allows the workforce to become more experienced and less prone to injury.”
Whatever the case, fewer claims are good news for insurers. However, the other effects of recession—lost business, falling premium prices—work in the opposite direction. In the end, the workers’ compensation insurance industry is faring “only slightly better than breakeven,” according to the NCCI.