Menu Close

The Workers’ Compensation Insurance Rating Bureau of California (WCIRB) has released its Quarterly Experience Report – As of September 30, 2022. This report is an update on California statewide insurer experience valued as of September 30, 2022.

Highlights of the report include:

– – Despite continued declines in insurer rates, written premium for the first three quarters of 2022 is 15% above that for the same period of 2021. Much of the increase is being driven by higher employee wage levels and the continued economic recovery.
– – Premium on policies incepting in the first nine months of 2022 is 7 percent higher than premium on policies incepting in the first nine months of 2021.
– – The average charged rate for the first three quarters of 2022 is 7 percent below that for 2021 and the lowest in decades.
– – The projected loss ratio for 2021, including the cost of COVID-19 claims, is 6 points above that for 2020 and 13 points above that for 2019.
– – Projected loss ratios have been growing steadily since 2016, mostly due to declining insurer rate levels and modest increases in average claim severity.
– – The projected combined ratio for 2021, including COVID-19 claims, is 8 points higher than 2020 and 35 points higher than the low point in 2016.
– – Excluding COVID-19 claims, the projected combined ratio for 2021 is 111% and the projected ratio for 2020 is 101%, which are still higher than those of recent prior years.
– – Indemnity claims had been settling quicker through the first quarter of 2020, primarily driven by the reforms of SB 863 and SB 1160.
– – A significant surge in the share of COVID-19 claims occurred in December 2021 and January 2022, driven by the Omicron variant.
– – COVID-19 indemnity claim frequency dropped significantly following the January 2022 surge but modestly increased through July during the recent surge of infections in California.
– – Projected total indemnity claim severity for 2021, excluding COVID-19 claims, is 1% below 2020 but 13% above 2017.
– – Following several years of flat indemnity severities, the projected indemnity severity for 2021 is 1% higher than 2020 and 19% higher than 2017.
– – The projected medical severity for 2021 is 2% lower than 2020 but 12% higher than 2017.
– – Pharmaceutical costs per claim decreased by 84% from 2012 through 2021.

The information presented reflects a compilation of individual insurer submissions of information to the WCIRB. While the individual insurer data submissions are regularly checked for consistency and comparability with other data submitted by the insurer as well as with data submitted by other insurers, the WCIRB can make no warranty with respect to the information provided by third parties.