Advisen FPN

Advisen Front Page News - Wednesday, April 29, 2020

The New Normal for Workers Compensation


The New Normal for Workers Compensation

By Douglas Turk, Regional Managing Director, West at NFP.

This post appears on altumAi’s futureWork blog page. It is republished here with permission.

What a difference a month makes. Prior to CV-19, workers’ compensation was the last holdout on increasing rates in the transitional P&C markets. We saw steady declines in comp premiums with markets continuing to expand their comp appetite and book of business.

As we enter an unprecedented time post CV-19, workers’ compensation looks to become one area where many CV-19 claims will land. Unlike the property and general liability lines, the expectation is that many of these comp claims will be paid and paid rather quickly. The comp market will inevitably adjust moving forward and need to capture rate, reduce exposure, and make sure portfolios are de-risked. We have read this script before and know a hard market will eventually develop but we need to ask ourselves – what is the new normal for workers’ compensation?

Outside of the markets’ inevitable movements, companies are questioning what other changes are to be expected for employers and workers. The simple answer is tremendous changes are on the horizon. We have just gone through a period where every single worker in the United States and the majority of the world has seen a change in their job. Let me say that again, every single worker, in the world, has been impacted. If in January someone had made a statement to that effect, they would have been at best ignored and worst run out of town with torches and pitchforks. Now, In April – it’s our new normal.

History is being written as we enter our new normal; countless employers are defining their next steps and their return-to-work standards as they go. We are all waiting, watching and wondering what measures will impact how our future will unfold. Many current activities across multiple global firms show a tremendous amount of inconsistency on companies’ response and initial return to work protocols.  A philosophical debate following Locke and Rosseau still rages today on the role of the organization versus the role of the person. Several companies are following government guidelines with physical distancing, PPE, and biometric data collection to some extent. Some employers are controlling the situation and making the worker follow the process and guidelines, while others put the responsibility back on the worker to self-monitor and self-report.

Regardless of where the philosophical argument ends up, the only constant is that worker health and safety is one of the most important business activities moving forward. 

We have already seen that there will be fundamental shifts in operations and process. At the immediate, tracking of worker specific data and location will be required. Biometric data (temperature) to ensure that workers are not creating or accepting undue risk will continue to be captured. Access to locations will be based on a physical and biometric review of workers and will inevitably extend to clients, customers, vendors, and any other invited attendees within company locations. 

For companies, the speed of worker risk identification will become a primary metric and the ability to respond will become a determination of operational and management efficacy. The new normal will include the use of body scanners for access to locations. Our personal data tracking will take on greater importance, to show both the employers, public entities, schools and others our current state of health and ability to work closely with others. 

Technology is and will continue to be a primary driver of this capability and functionality and with people more willing to share data for the collective safety of people based on the interconnected world.  Worker data will create insight, insight will create worker action, and worker action will avoid risk.  Finally, to answer my original question; the new normal for workers comp is having the ability to capture and interpret data that surrounds every worker to improve their health and safety.

About the author: Doug Turk is regional managing director, West at NFP and CEO of altumAI. He is a recognized innovator and leader with extensive experience in starting, growing and managing organizations. His career spans over 20 years in technology and insurance. He began his career as a key member of the leadership team that grew a small business into a global operation and took public. Doug has also worked in some of the largest insurance brokerages in roles including Chief Marketing Officer, innovation and P&L management. Doug is a subject-matter expert on insurance and the impact of technology in the space. He is a published author and frequent speaker on insurtech and the future of insurance. He holds three technology patents and is the author of CRM Unplugged. Doug resides in Los Angeles and is a co-founder of altumAi.

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