Private Workers Comp Insurers' Net Premium Grew 11.3 Percent in 2022

Private workers compensation insurers' net written premium increased 11.3 percent in 2022 from the prior year to $42.5 billion, according to the National Council on Compensation Insurance (NCCI).

Including state workers compensation funds, the 2022 net written premium was $47.5 billion, the NCCI said.

In its 2023 Workers Compensation Final Results Update, the NCCI said that private workers compensation insurers posted an 84.0 percent combined ratio in 2022 and an operating gain of 24.6 percent.

For state funds, the 2022 workers compensation net combined ratio was 115 percent, resulting in an 87.2 percent net combined ratio for the entire workers compensation industry, the NCCI said.

"The calendar year 2022 combined ratio is the second lowest combined ratio in recent history marking the sixth consecutive year under 90 percent and the ninth consecutive underwriting gain for the WC industry," the NCCI report said. "The current period of consecutive underwriting gains is unprecedented in terms of both duration and magnitude, resulting in a prolonged soft market atypical of the underwriting cycle."

Private workers compensation insurers' 24.6 percent operating gain in 2022 was the result of a 16.0 percent underwriting gain combined with an 8.6 percent investment gain, the NCCI said.

The NCCI also offered workers compensation data for the first half of 2023, though cautioning that the data is still subject to revision. That preliminary data shows private workers compensation insurers' direct written premium increasing 5 percent during the first half of 2023 compared with the same period in 2022.

In addition, insurers' direct loss ratio through the first half of this year was 47 percent, which was the same as what was reported for the first half of 2022.