By William Nibbelin, Head of Industry Data and Actuarial Science, Triple-I
While the workers’ compensation line continues to demonstrate remarkable resilience, underlying metrics indicate carriers must move beyond national averages to maintain long-term underwriting stability, according to the NCCI Annual Insights Symposium (AIS) 2026 – a key event for the workers’ comp industry.
“There’s not a single number that defines the workers’ compensation system,” said Donna Glenn, NCCI chief actuary, in her remarks on the NCCI State of the Line report. “Behind this year’s 91 combined ratio, factors such as industry mix, state differences, and carrier variation are all shaping results.”
Glenn added that insurers must interrogate the data and question these outcomes “to deliver deeper, actionable insights.”
State Differences
The workers’ comp system operates as a collection of unique jurisdictions with independent statutory frameworks and distinct economic exposures, creating variations in performance across states. NCCI acts as the licensed rating, advisory, and statistical organization for workers’ comp in most states, with California and New York being notable exceptions. Together, NCCI-rated states, alongside California and New York, make up 80 percent of the workers’ comp marketplace.
California results heavily skewed national reporting, with the state’s private-carrier accident-year combined ratio totaling 129 in 2025. Claims in the state can remain open after five years, at three times the national average, which has fueled a sharp escalation in cumulative trauma (CT) claims. Such claims now represent over 25 percent of all indemnity claims in the state, compared to a stable average of less than 5 percent across NCCI jurisdictions.
Litigation is another key driver, as more than 90 percent of CT claims in California become litigated. The transition to virtual case hearings has also allowed specialized legal firms to expand their reach statewide. Consequently, the California bureau filed a substantial 10.4 percent rate increase for late 2026.
In contrast, New York approved a loss cost decrease of 21.9 percent, effective late 2026, marking 10 consecutive years of downward rate adjustments. Workers’ comp writers in New York file for rate changes differently than those in California. In New York, they are required to use the New York Compensation Insurance Rating Board loss costs and, therefore, are only able to file loss-cost multipliers when filing for a rate change. In California, they can file loss costs in addition to their loss-cost multipliers.
New York also enforces strict medical treatment guidelines, generic drug formularies, and capped medical fee schedules that require extensive regulatory processes to alter.
On the exposure side, New York has experienced a noticeable post-pandemic structural shift in its economy. While overall total private sector jobs rose to 8.5 million, higher-risk sectors like construction and retail shrank by 7 percent and 9 percent, respectively, since 2019.
Regulatory Impacts
Looking at other states,Nevada was used as an example of how standalone statutory mechanisms impact actuarial trends. The state filed a standalone 21.6 percent loss cost increase for early 2026, an extreme outlier within NCCI states, driven by new state regulations. Senate Bill 317 effective October 1, 2026, will raise Nevada’s long-standing statutory cap limit on exposure reporting of $36,000 of an employee’s payroll to approximately $100,000.
Local medical and administrative delivery systems also impact state performances. NCCI actuaries evaluated temporary disability duration across claims closed within two years and observed substantial state-by-state disparities:
- Low Duration States (e.g., Oregon, Vermont): 6–7 weeks on average.
- High Duration States (e.g., the Carolinas, Georgia): 15 weeks on average.
Local care protocols, administrative efficiency, and attorney involvement amplify these disparities, with durations of litigated claims averaging six months longer than non-litigated counterparts.
“The time to close a workers’ compensation claim shows wide variation across jurisdictions: an additional 9 to 25 weeks after all medical services have been delivered”, said Raji Chadarevian, NCCI executive director for actuarial research. “That can have a meaningful impact on the cost of the claim.”
Industry-Specific Trends
At an industry level, claim trends diverge significantly from national averages:
- Construction remains the largest industry sector by premium volume at 27 percent and achieved the largest drop in claim frequency at approximately 7 points between 2023 and 2024. Frequency decreased across each of its 10 largest job classifications, though medical severity remained the highest of any industry sector, driven by severe fall-from-height hazards. Notably, medical claim severity rose by a substantial 13 points between 2023 and 2024, with over half of the top ten construction classes reporting double-digit severity increases.
- Health Care is, on average, a higher-frequency industry. Breaking from historical declines, claim frequency increased slightly in 2024, driven by significant multi-year employment growth that introduced a high volume of inexperienced, short-tenured workers. This was the sole sector that meaningfully contributed to job growth in 2025.
- Office & Clerical roles are a historically low-frequency, low-exposure sector. Following a significant drop in frequency in 2020 due to widespread pandemic-related remote work, and a subsequent rebound in 2021, frequency decline has continued to outpace most other sectors. However, the sector recorded a slight increase in frequency in late 2024, primarily from a spike in motor vehicle accident claims for clerical workers whose professions involve driving.
Learn More:
Core Drivers and Emerging Risks for Workers’ Comp
Triple-I State of the Line Issues Brief: Workers’ Comp (members only)
Facts + Statistics: Workplace Safety/Workers’ Comp
Spotlight On: Workers’ Compensation