By Marina Mats and Deepak Varshney, Riskonnect
More than a year has passed since the start of the pandemic. Since the abrupt shutdown in mid-March 2020, claims trends have been somewhat erratic, likely a reflection of the numerous tightening and loosening of pandemic-related restrictions. Overall, however, the number of incidents decreased by 10% when comparing February 2020 (the last full month of prepandemic data) and February 2021.
How does that impact translate into incident experience? Here’s a look at current trends by line of coverage and by industry, based on the U.S. property and casualty incident data of more than 400 organizations across 20 industries.
Overall Incident Volume
The lowest number of incidents was logged in April 2020, the peak of the lockdown. Since then, the number of incidents has steadily risen, increasing by 4% in March 2021. Interestingly, the average number of overall incidents has remained fairly constant since June, when businesses first started to reopen.
By Line of Coverage
General Liability. The year-over-year number of GL incidents increased by 3%. GL incidents are up 25% compared to April 2020, when incident counts were at its lowest.
Auto Liability. AL incident trend has slowly and steadily risen since April 2020 – currently up 12%. But the number of AL incidents is still significantly lower – 36% – than February 2020. And this makes sense as many employees continue to work from home. Beyond business-related claims, however, fewer cars on the road and fewer miles driven did not translate into fewer crashes. According to the National Safety Council, the total number of motor-vehicle deaths actually increased by 8% over 2019.
Workers’ Compensation. The number of WC incidents decreased by 20% since April 2020 and 6% year over year. Always a relatively volatile line of coverage, WC has experienced significant fluctuations in the volume of incidents over the past year. Overall, however, the trend is slightly down.
Claims Trend Watch by Line of Coverage
2019 – 2020 Incident Volume by Line of Coverage
Workers’ Compensation Incident Trend
Sports, Entertainment and Events. Fans are back in the stands – sort of. Most sporting events are now allowing at least a limited number of spectators, which has spurred an increase in incidents – up 91% over April 2020 when everything was dark. The current incident rate has held steady since December, which is still 53% lower than February 2020.
Travel, Hospitality, Gaming, Aviation. The volume of incidents continues to rise since April 2020 for the hospitality industry (up 58%) and aviation industry (up 51%). But the year-over-year volume is still much lower than prepandemic – down 37% in hospitality and 42% in aviation. The decrease is not surprising since most theme parks, hotels, casinos, and others are still operating at reduced capacity. And while leisure travel is definitely starting to bounce back, business travel is still largely on hold, which continues to impact the aviation industry.
Other Industries. The overall change in the volume of incidents is only about 10% off of February 2020 reporting rates. Could this signify the beginning of a return to normal?
Claims Trend Watch by Industry
(February 2020 to February 2021)
For a look at past trends, check out Claims Trend Watch: Q4 2020. For more on managing claims effectively, download our e-book, Claim Success: How to Achieve Excellence in Claims Management.