Delaware Business Insurance Update from CNC Insurance Associates: Delaware Work Comp, A Perfect Storm?

I have been scrambling to touch base with all my clients informing them about the proposed 40+ percent work comp rate hike in Delaware. In those conversations my clients are all asking the same fundemental question, "why"?  My belief is that a perfect storm has hit the Delaware work comp market. Back in 2007 the state passed a work comp reform bill that was to reduce medical costs. The problem has been there was no real way to assure that the doctors and hospitals would follow the fee schedules. Also the recession took a lot of workers out of the work force that have slowly been hired back. This is causing an uptick in claims. The rate roll back forced by the Chancery court in 2008, took to much premium out of the system, to fast. As claims costs rose and premiums fell, an unsustainable path was created that lead us to where we are today. Finally, the insurance companies have not been making as much profit in their investments. They are looking to increase rates across all lines of insurance to achieve better returns and profitability.  So Delaware business owners are now facing proposed higher rates due to this "perfect storm".  The problem here is that they can't afford it. The economy has not been stellar by any means and 40 percent is a whole lot of additional premium dollars for business owners to pay. I am not sure how this will end up. The November 2nd public hearing is fast approaching and I am sure there will be some debate on this rate increase. Until next time be careful out there and know your risks. K
G. Kevin Nemith, Business Insurance, Small Business Insurance Specialists, serving Delaware, Maryland, Pennsylvania, & New Jersey.
www.cncinsurance.com
www.bizinsurancetv.org

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