W.C. Financial Results For '93 Show Marked Improvement With Combined Ratio Down 12 Points.

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ORLANDO, Fla., /PRNewswire/--After nine years of disastrous financial results, workers' compensation insurers experienced a marked improvement in 1993.

Announcing an overall combined ratio of 109.5 for 1993, Ronald C. Retterath, senior vice president and chief actuary of the National Council on Compensation Insurance (NCCI), stated, "This 12-point drop from 1992's 121.5 ratio gives us the first glimmer of hope for a reversal of fortune in the workers' compensation line." The combined ratio is the ratio of insurers' cost to revenues.

Retterath was addressing some 500 executives from insurance companies, self-insurer groups, state funds, state legislatures and regulatory agencies at NCCI's 1994 annual issues symposium held here April 20 and 21.

"There are several positive developments behind these improved results, including reduction of loss cost inadequacy in several states, reform legislation, alternate residual market mechanisms, emphasis on anti-fraud measures, reduction in cost trends, and favorable economic developments," he said.

Retterath pointed out that state workers' compensation system reform legislation in recent years has been a major contributor to the financial improvement. "For instance," he said, "key reforms have been enacted in Texas, California, Oregon, Pennsylvania, Rhode Island and New Hampshire. Florida has also made major changes to its workers' compensation law, with the most recent change showing much promise for reducing future cots increases."

A corollary effect of some of the benefit reforms is a reduction in the speed at which costs are increasing, he said...