Some experts say the Recession began in September of 2007, but this study marks it as starting in December of 2007.

In the graph below, created by III and its President Robert P. Hartwig, it shows how insurance claims adjusting employment went from its peak in late 2008 at around 57,000 down to approximately 44,000 in September of 2010.  That’s a decline in roughly two years of 13,000. 

Of course, that’s a drop effectuated by the drop in employment on the wake of the clean up of Hurricane Katrina in 2005, and the other hurricanes that came right on Katrina’s wake, but considering those storms created a demand mostly for CAT adjusters, the demand for commercial liability and workers’ compensation adjusters simply went down steadily commencing in 2007 to 1994 and 1995 employment levels after 1996 to 2007 had strong employment opportunities for liability and workers’ compensation adjusters.

Now that the general national economy is still sputtering to make a comeback, as seen in the chart just above, there’s a trend upward with a modest increase in insurance brokerages’ and agents’ employment numbers.  Just in November the agents’ sector led the insurance industry in employment growth.

As can be seen in the chart above, the Agents/Brokers sector is the one sector that grew the most, with five other sectors declining and three sectors growing less significantly.   Agents and brokers are now taking a more powerful and influential role in the lives of insurance carriers, and some are owners of TPAs or at least have developed intimate relationships with TPAs.   Brokers are now outsourcing more the claims handling of the carriers with whom they write business. 

Henceforth, the growth of the TPA sector can be viewed in part as a result of many insurance carriers now outsourcing their claims work.  In December of 2010, just one month ago, American Claims Management (ACM) based in San Diego, California, announced through a Press Release that it was now handling the workers’ compensation claims from Zurich North America Commercial’s Programs on policies written on and after December 1st 2010 by its parent company, broker Arrowhead General Agency.   In November of 2010, ACM announced through a Press Release that it was now handling claims for Starr Indemnity & Liability Company.  On October 1, 2010, ACM had begun handling commercial general liability and commercial auto claims for Starr Indemnity's Contractors Package Program written in California through Arrowhead General Insurance Agency.

Evidence now of a growing need for workers’ compensation claims adjusters can be seen in the advertisements posted within the past sixty days on www.adjustercom.com.  All the Job Ads come from TPAs and one self-insured, self-administered entity.  No insurance carriers directly handling claims have posted.

AIMS in Sacramento, California, a TPA, is looking for a workers’ compensation claims supervisor and claims examiner. York Insurance Services Group, a TPA in Upland, California, is seeking a workers’ compensation claims examiner and a medical only examiner. Tristar Risk Management, a TPA, is looking for a work comp examiner in their Alhambra, California, office. 

One self-insured, self-administered entity, Southern California Edison, in Rosemead, California, is looking for two workers’ compensation claims representatives.

Since insurance brokers and third party administrators are teaming up now to handle worker’s compensation claims being outsourced by insurance carriers, as well as continuing to handle most of the claims of self-insured entities, workers’ compensation claims professionals should look to the TPA’s during these next days for their new career opportunities. 

Insurance Industry Employment Trends 1990-2010 by Robert P. Hartwig, PhD, CPCU, Insurance Information Institute, New York

Lonce LaMon lonce@adjustercom.com