Date: Feb 13, 2014
Workers' Compensation File

The workers’ compensation insurance industry is not making a profit, says an analyst of the American insurance industry, and is currently losing 8.5 cents on every dollar of premium it collects.  This means rates will continue to rise in order to move the industry to profitability.  Although the situation has improved, most carriers are trying to recover from several years of negative results.  Medical costs continue to have the biggest impact on workers’ compensation losses, amounting to 60 percent of the total loss.  Drug prescriptions alone comprise 19 percent of medical costs.  Although the insurance industry works to keep other costs within the system as low as possible, the industry has had little influence on rising medical costs.

Business entities can have a positive impact on insurance costs by taking this three step approach:

  1. Combine safety training and loss prevention efforts to prevent injuries from happening;
  2. After a loss occurs, reduce the cost of the loss by closely managing the claim and adopting return-to work programs;
  3. Close long term claims; implement loss control activities and training programs to improve  workplace safety to establish a culture of safety

This three-pronged approach can keep your loss costs down and provide a business with multiple, lower cost options for its workers’ compensation costs.  Western Growers Insurance Services specializes in working with members on this approach.  If you’d like to get more information regarding this approach, contact Greg Nelson, Director of Commercial Lines at (949) 885-2287 or

WG Staff Contact

Greg Nelson
Vice President, WGIS Sales

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