Storm & Security

PROTECT/YOURSELF | by Don Leggett | Active Season Ahead The 2013 forecast for business insurance programs. Which way your insurance premiums are going will be determined more by geography than any other factor. Here's the forecast: • Property Insurance way up in the Northeast, down in the Southwest • Workers Compensation rates up everywhere, except California and Colorado • Health Insurance premiums going out of control across the United States in anticipation of health care reforms scheduled to take affect January 1, 2014. Property Premiums Rise and Fall In the Northeast, 10 to 20 percent will be the normal rate increase with most traditional insurance carriers trying to reduce carriers would see investment income, which would help offset the underwritten losses they have sustained in the past three years. Workers' Comp Going Up Workers' Compensation will see rising prices as a medical component of the insurance coverage—with the strong demand for prescription drugs—will drive the rates significantly higher. Several states have altered the way workers' compensation modification factors are calculated, and those businesses with low modifications will get lower rates and those with high modifications, particularly those with frequency issues as well, will see their rates rise by 25 percent by year's end. Old school weapons to lower the workers' compensation cost are pre-hire drug screening and back-to-work policies. The test making the biggest reduction in workers compensation Many associations and industries are working on solutions to rising health care costs with the most promising being a combination of employer paid health benefits, employee paid wellness benefits and the migration of hospitals from provider of benefits to the coordinator of benefits their property risk along the Eastern Seaboard. Last year's hurricane winds and the waves brought with them cost $25 billion in insured losses and $50 billion in total losses. The nor'easter that followed Hurricane Sandy made it one of the most miserable storms in the last 100 years. Regions in the Southern Hurricane Zone, Texas to South Carolina, will see property rates rise 2 to 5 percent, but the remainder of the country could see property insurance premiums fall as fierce competition for non-coastal insurance premiums heats up the marketplace. If the federal government stops printing money and interest rates rise, property premiums might actually fall in several areas of the country as the insurance 22 STORM & SECuRITY PROTECTION / FORECAST 2013 pricing is an integrity test, which is being administered free of charge for customers enrolled in the Insurance Office of America Compass program. Compass stands for leading your company to profitability and is free to most businesses located in the United States and Canada. The designer of the integrity test touts a 63 percent reduction in insurance premiums when employees are consistently given this test. Health Care Specter Finally, the biggest concern for an employer is the specter of out-of-control health care costs. The government has promised health care exchanges and to begin enrolling

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