Will the soft market in workers comp persist?
The workers comp market is still soft, with rates continuing to decline. However, the rate of decline has leveled off somewhat, with the latest stats indicating a decrease of less than 2% in the second quarter.
While some think the tapering off is due to the effect of the California and Florida reforms tapering off, I'm not so sure.
Several large carriers I've spoken with have seen double digit improvements in the loss ratio in California; these folks want to write more CA business - lots more.
Add to that the recent NY reforms, and we may be in for a bit of increase in the rate of decrease (boy, that's awkward), or in English, rates may continue to decline or even decline faster.
My sense is the market will continue to soften in key states, with the possible exception of TX and FL. Payers are having a very tough time getting providers to join networks in TX, and the recent rate decreases in FL have made profits in that state a lot more uncertain going forward.
