Wall Street Journal Article Has North Carolina Workers’ Compensation Insurers Buzzing
A November 18th article in Wall Street Journal about the profitability of workers’ comp insurance has carriers who deal with North Carolina workers’ compensation policies buzzing. Liberty Mutual’s Chief Executive Officer was quoted in the article worrying about the threat of inflation to the workers’ comp industry. Edmund “Ted” Kelly hinted that his company would “willingly reduce our exposure” to the workers’ comp sector because of fears of inflation.
Across the industry – including here in North Carolina — workers’ comp coverage is sold at a loss. This means that insurers pay out more in claims than they collect through premiums. This isn’t to say that insurers don’t make money in this business. They take the premium money they collect and invest it to generate profit. But the CEO worries that the “time bomb” may soon go off – perhaps as early as 2014 – and cause serious tremors throughout the industry.
What might this all mean for employers and claimants here in North Carolina? It’s obviously too early to even begin to speculate how industry-wide policies could come back to alter employer practices or employee resources. But it’s important to recognize that there is a relationship here. Often, when employers and employees complain about the “unfairness” of this system, they are ultimately frustrated by macro level decisions made by the insurance industry or made by policy makers in Washington or in the NC state capital. Obviously, if you suffer from a lower back injury from work you did at a construction site in Raleigh, you don’t need to follow the latest AIG sales strategies. But the people who represent you with your claim should demonstrate a deep awareness of what’s going on in the industry – at both the state and national levels.
After all, North Carolina workers’ compensation claims can often get incredibly complicated and convoluted, even if they start out seeming simple. An employer may do a 180, for instance, and refuse to pay out a legitimate claim. Or an insurer may deny a claim based on bad data or an obscure provision written into a contract somewhere. Injured workers obviously don’t have the time, energy, or wherewithal to delve into all these legal details, and they often find the system to be tremendously inflexible and unresponsive. These people need advocates who can help make the system work for them – and most importantly, to make things simpler, easier, and faster, so that they can focus on healing, being with their families, plotting out their financial strategies, and getting back to work.
A North Carolina workers’ compensation firm can provide you with the strategic know-how and guidance you need to manage your claim productively and eliminate the enduring stresses associated with it.
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Edmund “Ted” Kelly
