OIR Releases 2010 Annual Report for Workers’ Compensation
The Florida Office of Insurance Regulation has released its 2010 annual report on the workers’ compensation insurance industry in Florida. The report reviews the availability and affordability of workers’ compensation insurance coverage in Florida to assess the current state of the market. The report finds that the Florida market is competitive, as evidenced by a large number of insurers writing workers’ compensation insurance. The report observes that no market participant has sufficient market share to dictate pricing, and there are no significant barriers to entry or withdrawal that adversely affect the market. The OIR notes that the number of entrants to the market as compared to withdrawals also suggests the workers’ compensation insurance market is attractive.
The report points out that Florida’s residual market for workers’ compensation insurance is relatively small, particularly when viewed in relation to residual markets of other populous states.
“The 2010 report clearly demonstrates a healthy marketplace in Florida with multiple competitors, numerous options for purchasing insurance, and competitive premiums relative to other states,” said Insurance Commissioner Kevin McCarty. “Maintaining competition and consumer choice is especially important for Florida businesses given the current economic environment.”
The report shows the Florida market has 260 entities writing workers’ compensation insurance, 255 of which are private insurers. The residual market, the Florida Workers’ Compensation Joint Underwriting Association, had 746 policies as of October 2010 with corresponding premiums of $5.5 million. This is a small part of of Florida’s overall workers’ compensation premium of $1.71 billion.
Workers’ compensation insurance rates have declined by a cumulative 61.9% following reforms made by the Florida legislature in 2003, although the most recent National Council on Compensation Insurance rate filing provided for a 7.8% increase as the 2003 reforms are now fully reflected in the rate base.