Boca Raton, FL – A new NCCI research report provides the latest frequency change estimate for Accident Year 2012 and examines the effect of the recession on frequency changes by various claim and employer characteristics.
The Great Recession of 2007–2009 was the most serious and long lasting economic contraction since the Great Depression. The recession and its modest recovery had a considerable influence on workers compensation claim frequency.
In fact, claim frequency for workers compensation injuries increased 3.8% in Accident Year 2010, marking the first increase since 1997. Prior to the 2010 uptick, claim frequency had been declining at an average rate of more than 4% per year since 1990. Following the 2010 uptick, claim frequency declined in 2011, albeit by a modest 0.9% (and, as just noted, declined in 2012).
In Accident Year 2012, lost-time claim frequency declined by 5% according to preliminary estimates, While frequency decreased by 5%, the average cost per lost-time claim increased 1% for indemnity and 3% for medical.
Over the five complete policy years ending with Policy Year Expiring (PYE) 2011:
- Frequency per payroll declined by 16% (4.3% per year) but has leveled off over the latest two years.
- Frequency per payroll declined for all industry groups, most notably in Contracting and Manufacturing.
- Frequency per payroll declined for all employer sizes, with the largest declines for employers having more than $100 million in payroll.
- Frequency declines were relatively consistent by NCCI type of injury.
- Payroll volume increased by double digits in the Oil & Gas and Health Care sectors, while declining nearly 2% for all industries combined. In the Oil & Gas sector, claim frequency is notably high in the emerging Hydraulic Fracturing industry.
Click here to access the free report: NCCI Workers’ Compensation Claims Frequency – 2013 Update (PDF)
Source: NCCI