NCCI -Channeling Change: Meeting the challenges of an evolving market

Each year, the National Council on Compensation Insurance (NCCI), which gathers data, analyzes industry trends and legislation, and prepares insurance rate and loss cost recommendations, holds an Issues Symposium. The theme for 2016 was Channeling Change: Meeting the Challenges of an Evolving Market.

The new President and CEO, Bill Donnell, noted the industry is on solid ground financially; the industry was profitable in 2015 and claim frequency continued to decline. Noting the tremendous strides made in reducing the number of workplace incidents, he said it was important to have a broader understanding of the intent of workers’ compensation: timely and appropriate medical treatment and positive outcomes that return workers to their job quickly.

Highlighting two employers, Iron Mountain and Harley Davidson, that have had significant improvement in their workers’ compensation results, he spoke of the need to adapt to the changing workplace. Both companies made fundamental changes that, over time, evolved into a culture shift, increasing accountability, risk awareness and discipline.The big emphasis was on personal and timely contact with injured employees, keeping injured employees active, return-to-work and stay-at work programs, honing in on incident types and proper training, improved hiring processes, and revamping the claims management process.

The results were remarkable. In 2009, every year one out of three Iron Mountain employees were going to the hospital with some sort of work-related injury. Workers’ comp costs were close to $18 million a year. By 2014, Iron Mountain reduced its costs by 50% to $9 million dollars and Harley Davidson saw claims reduced by almost 70% between 2009 and 2013.

O’Donnell continued the tradition of choosing one word to define the current state of the workers’ compensation industry and his choice for 2016 is “Transforming.” With increased automation and the new ways employees work, the workplace is transforming. Markets are transforming as underwriting becomes more important in low interest environments, and new regulatory agendas and more stakeholders increases uncertainty and risks.

While the industry must respond to these factors, all of this has important implications for employers. They must move beyond the myopic approach of reacting to work-related incidents and understand that health and safety management is an integral part of the overall business strategy. The continual question should be, “What would help employees do their jobs better and safer?” They must see risk management as an opportunity to improve the bottom line.

For Cutting-Edge Strategies on slashing Workers’ Compensation Costs visit

Leave a Reply