US workers comp rates showing slippage vs costs, still short of regulatory trip-wires: Hartford CEO

Insurance rates are losing ground to rising claims costs in the US workers compensation market, but the slippage remains insufficient to mount a strong case for rate hikes with regulators, Chris Swift, chief executive officer of  The Hartford, said Tuesday (February 15).

"If you look at our long-term assumptions on the cost of goods sold, in frequency and severity, pricing is not keeping up as we head into 2022," Swift told investors and analysts during an ongoing conference hosted by Bank of America Securities.

"Exactly when that would change is hard to say; you need history and results to take to regulators and as long as the line continues to perform as it has, it might be a bit longer before increases are necessary," Swift said.

Swift brushed off immediate concerns about the profitability threshold. He called 2020 a "profitable year" and 2021 "a very profitable year" and the segment "continues to perform exceedingly well from a return and ROE side" at the start of the year.

Across the remainder of segments, The Hartford claims rates "continue to be supportive," Swift said in reiteration of recent guidance.

"We think pricing is going to continue to exceed cost of goods sold in most lines with the exception of workers comp," he said.

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