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Excess workers comp insurance is a challenging line to underwrite because it guarantees the payment of catastrophic worker claims that can remain open for decades.

But it’s precisely for that reason that self-insured employers want to purchase the excess coverage from an insurer that will be around for decades to come, experts say. It’s also why few underwriters offer the insurance as a stand-alone product.

And now, American International Group Inc. disclosed in a 2012 Securities and Exchange Commission filing that it had ceased writing stand-alone excess workers comp cover because of its extremely long tail and risks that make it “one of the most challenging classes of business to reserve for.”

Issues that escalate costs – such as obesity, opioid pain medication usage and Medicare set-aside requirements – have pushed excess workers comp underwriters to raise their prices and demand that clients assume greater retentions.