Writing WC Insurance in Florida Has Become a Highly Profitable Business
Writing workers' compensation insurance in Florida has become highly profitable over the last few years - so much so that Florida employers deserve a premium decrease of another 36.3%. That's the conclusion of this actuarial analysis prepared by the Florida Insurance Consumer Advocate. The National Council on Compensation Insurance (NCCI) has proposed an average premium decrease of 16.5% for Florida's employers commencing on 1/1/2008. That's not enough, says the report which concludes
- It should be evident from the above analysis that writing workers' compensation insurance in Florida is a low-risk, highly profitable business that does not require large amounts of capital to cushion potential unexpected claims or expenses. Claims results from year to year are highly predictable based on historical performance over the last several years and are improving with no reversal on the horizon. . . .If the full recommended reduction of 36.3% is not approved, then insurers will in effect be allowed to earn profits on excess surplus that is not necessary to support their premium writings.
A rate hearing is scheduled for 10/8/2007 before Florida's Office of Insurance Regulation. Largely as the result of the 2003 legislative reforms, over the last few years that office has approved premium reductions of 14.0% (10/1/2003), 5.1% (1/1/2005), 13.5% (1/1/2006), and 15.7% (1/1/2007).
