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Workers Comp Soft Market – I Was Wrong On This One


How Did We End Up With A Workers Comp Soft Market?

Many months ago, during the pandemic, I had predicted that a Workers Comp soft market was a long tunnel with a small light at the end.    The carriers were going to become ultraconservative (not cherry-picking) by underwriting only extremely safe employers with a return to where the Assigned Risk Pools and competitive State Funds would carry the weight during a post-pandemic insurance world.

Well, I was wrong on that one.  I was thinking globally that a US Treasury investment sell-off by China would cause pandemonium in insurance carrier investments. That variable is not finished yet with what seems like a banking crisis in China likely upcoming since 2014 which would rattle the investment and insurance markets.

What I did not see was the high profitability of the workers comp line internally (ROI) that would eventually place work comp as the profitable piece of business that supported the other lines of insurance.

Workers Comp Soft Market – Agency View

An Insurance Journal article from March of this year contained a great quote (no pun intended) from an agency that said

“It’s a little longer for some states, but nationwide we’re on an eight-year soft market, which is probably the only line that is a soft market right now,” said Justin Dorman (Burns & Wilcox), workers’ compensation national product manager. “And really, it’s because workers’ comp is still profitable.

“It’s highly desired by most carriers, and most carriers are writing other lines of business and including work comp – requiring work comp – because it is profitable and allows them to write other business that may not be as profitable.”

By the way, if you do not subscribe to or read the Insurance Journal articles and attend the webinars, you are definitely missing out.

Bottom Line

I was looking at the external factors heavily in my thinking on a workers comp soft market.  What Justin said in the above passage shows that the IRR (Internal Rate of Return) can sustain any insurance crisis and even unbelievably sustain carriers in writing other lines that are experiencing hard markets.

pic of feather workers comp soft market
Public Use License – MichaelMaggs


James J Moore - Workers Comp Expert

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Management Consultants, Inc. in 1996. J&L’s mission is to reduce our clients’ Workers Compensation premiums by using time-tested techniques. J&L’s claims, premium, reserve and Experience Mod reviews have saved employers over $9.8 million in earned premiums over the last three years. J&L has saved numerous companies from bankruptcy proceedings as a result of insurance overpayments.

James has over 27 years of experience in insurance claims, audit, and underwriting, specializing in Workers’ Compensation. He has supervised, and managed the administration of Workers’ Compensation claims, and underwriting in over 45 states. His professional experience includes being the Director of Risk Management for the North Carolina School Boards Association. He created a very successful Workers’ Compensation Injury Rehabilitation Unit for school personnel.

James’s educational background, which centered on computer technology, culminated in earning a Masters of Business Administration (MBA); an Associate in Claims designation (AIC); and an Associate in Risk Management designation (ARM). He is a Chartered Financial Consultant (ChFC) and a licensed financial advisor. The NC Department of Insurance has certified him as an insurance instructor. He also possesses a Bachelors’ Degree in Actuarial Science.

LexisNexis has twice recognized his blog as one of the Top 25 Blogs on Workers’ Compensation. J&L has been listed in AM Best’s Preferred Providers Directory for Insurance Experts – Workers Compensation for over eight years. He recently won the prestigious Baucom Shine Lifetime Achievement Award for his volunteer contributions to the area of risk management and safety. James was recently named as an instructor for the prestigious Insurance Academy.

James is on the Board of Directors and Treasurer of the North Carolina Mid-State Safety Council. He has published two manuals on Workers’ Compensation and three different claims processing manuals. He has also written and has been quoted in numerous articles on reducing Workers’ Compensation costs for public and private employers. James publishes a weekly newsletter with 7,000 readers.

He currently possess press credentials and am invited to various national Workers Compensation conferences as a reporter.

James’s articles or interviews on Workers’ Compensation have appeared in the following publications or websites:

  • Risk and Insurance Management Society (RIMS)
  • Entrepreneur Magazine
  • Bloomberg Business News
  • WorkCompCentral.com
  • Claims Magazine
  • Risk & Insurance Magazine
  • Insurance Journal
  • Workers Compensation.com
  • LinkedIn, Twitter, Facebook and other social media sites
  • Various trade publications


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