The self-insured claims volume for private businesses fell by 9.5 percent in the year 2023. This was the biggest year-to-year decline in claim frequency for the private sector in more than 15 years.

According to the California Workers’ Compensation Institute’s (CWCI’s) review of the California office of Self-Insurance Plans (SIP), total paid losses were driven sharply higher for self-insured employers in the private sector.

SIP’s annual summary of self-insured data for the private sector provides the first look of private self-insured claims experience in California for 2023. The summary includes the total number of covered employees, indemnity and medical-only claims counts, and total paid and incurred losses through the end of the year. 2023’s summary shows the experience of self-insured employers in the private sector who covered 2.34 million California employees last year and who reported 94,386 claims in 2023. That was down from 104,278 claims in the 2022 initial report. Private self-insured employers reported 48,404 medical-only claims in 2023. That was down by 7.4 percent from 2022. That was 10.6 percent above the 43,779 medical only claims noted in 2020, when closures due to COVID-19 pushed down medical-only volumes as the California economy went through a recession, however brief according to the CWCI.

Self-insured indemnity claims volume in the private sector spiked during the pandemic. It fell in 2023 thirteen percent to 45,982 claims.

The latest claim count works out to an overall frequency rate of 4.03 claims per 100 self-insured private-sector employees in 2023, down from an overall rate of 4.31 in 2022. This marks the first decline in self-insured private sector claim frequency since the pre-pandemic year of 2019. That is the most significant drop in the 16 years covered by the CWCI review.

The self-insured private sector’s first report of total paid and incurred losses were up in 2023 in spite of the declines in claim volume and frequency. Paid losses though the fourth quarter totaled $340.2 million, 9.4 percent more than the first report total for 2022. Total paid indemnity rose by 6.7 percent to $172.8 million, and total paid medical-only increased by 12.2 percent to $167.4 million.

The data also show that first report total incurred losses claims rose to $864 million in 2023. That was up 6.4 percent from the comparable 2022 figure, as total incurred indemnity at the first report increased by 4.7 percent to $361.4 million, and total incurred medical increased by 7.7 percent to $502.6 million.

Because there were 9,892 fewer self-insured claims in the private sector in 2023 than in 2022, the increases in total paid and incurred amounts in 2023 can be ascribed to the growth in the average paid and incurred losses at the first report. Average paid losses per claim climbed 20.9 percent to $3,605 while average incurred losses rose 17.6 percent to $9,153.

Subscribers and members of the California Workers’ Compensation Institute can log onto the Communications section of the CWCI website to view more details, analysis, and graphics. https://www.cwci.org/

Lonce Lamonte
Journalist / Editor
lonce@adjustercom.com
www.adjustercom.com
www.adjustercom.net