Top 10 Challenges for WC – The Next Five
Top 10 Challenges – part 2 of 2
6. 24 hour coverage – WC and health melding
7. No young workers in WC, Risk Management, or Safety Industries
8. Deflation of the dollar as a currency
9. WC carrier mergers
10. WC carrier failures
Bonus – Spiraling medical costs to even become worse
24 Hour Coverage

There has not really been much success with 24-hour healthcare coverage. The concern is that 24 hour coverage would heavily affect the Workers Comp market. Claims handlers would have to be versed in health insurance and Workers Comp or a claim would have to be directed to a certain department depending on whether the accident occurred at work. The pricing for this type of coverage would be complicated at best.
Where Are The New Recruits?
This concern became apparent when I recently attended a large safety conference. Every year a large contingent of the attendees would gather at the hotel’s main nightclub. This year, the club shut down well before midnight. I then realized the crowd had been the same for 10 years with very few younger workers.

Over the years, we have had numerous college interns work over the summer. Even though I/we tried to steer the interns towards WC or Risk Management, all of them took different paths. All of our interns have become somewhat successful, however, the success was in other industries, especially banking
A great Risk Management degree has been and is now supplied by Appalachian State University.
Dollar Deflation
The deflation of the dollar was covered very well in this article. The main concern here is the deflation of the dollar as a currency will only make the return of investment even more difficult for carriers. Once again, as in the previous list, the policyholders will make up the difference with higher premiums.
Even China has had its problems in the banking industry. A tidal-wave effect would be felt in the overall economy if China had to pull out of its US investments.
Workers Compensation Carrier Mergers/Failures
These two were combined to keep the article from being too long. As carriers merge, much like the airline industry, competition will sag and prices will increase. The basic supply and demand model shows that when the same demand (coverage) exists and the suppliers (carriers) shrink in number, prices will naturally rise.

The ULICO merger sent ripples through many markets. ULICO provided many lines of insurance that were hard to find elsewhere. This change will be felt for many years to come as the claims are worked through the WC system.
Spiraling Medical Costs – Bonus
One of the unique conundrums in WC is that when prices are reduced, suppliers of medical treatment and equipment tend to make up that price reduction with an increase in usage. I performed studies over the years for medical treatment vendors and found this to be true. NCCI and WCRI both verified this conclusion.
Bottom Line – One has to attain all the education possible in the insurance, Risk Management, and safety industries. Flexibility is the key. You may not be doing the same type of job in the near future, so be prepared.
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