There were over 5,000 fatalities at work in 2020 and 4.9 million workers' compensation claims are filed every year by both private and government employees. And get this: did you know that the typical workers' compensation claim amounts to around $41,000? We will explore what workers' compensation insurance is, how many claims are filed each year, as well as employer costs for 2021 and whether or not you should have a workers' comp insurance policy if you run a small business.
Top Workers Compensation Statistics:
- There are 4.9 million workers compensation claims made each year by both private and government employees.
- The typical workers comp claim is around $41,000.
- The average cost of a workers compensation claim for sprains is $34,409.
- Falls/Slips claims costs averaged $47,681 per claim.
- Workers' compensation costs to employers total $100.2 billion as of 2021.
- Workers' comp claims pay out more than $62 billion each year, $31.8 billion in cash settlements and over $31.3 billion in medical benefits.
TABLE OF CONTENTS
Top Workers Compensation Statistics:
Workers Compensation Claims Statistics (2022)
Workers' Compensation Denial Statistics
Workers' Compensation Fraud Statistics
Workers' Compensation Return-To-Work Statistics
Workers Compensation Insurance Statistics
Concluding Thoughts
Workers Compensation Claims Statistics (2022)
What Is Workers' Compensation Insurance?
Workers' compensation insuranceis accident coverage paid by employers. If you are injured or sickened on the job, you may receive benefits to cover medical bills or rehabilitation costs.
Workers' compensation also covers partial lost wages if you miss work. Some policies also provide death benefits if you’re killed on the job.
Workers' compensation insurance only applies if you are injured or sickened while performing the duties of your job.
How Many Workers Compensation Claims Happen Per Year?
Every year, roughly 4.9 million workers compensation claims are filed by both private and federal employees.
How Much Do Workers Comp Claims Pay Out Each Year?
Workers' compensation claims payout approximately $62 billion each year, or roughly $31.8 billion in cash payments and $31.3 billion in medical benefits (2016 estimate).
How Much Are Employers Paying in Workers Compensation Claims?
The overall employer costs for workers' compensation were $100.2 billion in 2021.
How Much Is The Average Workers Comp Claim?
The typical workers' compensation claim is about $41,000. The average cost of a sprain is $34,409, and the average cost of a fall/slip is $47,681.
How Much Are Employers Paying in Workers Compensation Claims?
The overall employer costs for workers' compensation were $100.2 billion in 2021.
How Much Are Insurers Paying in Workers Compensation Claims?
It costs businesses an average of $957 per employee a year to adhere to labor law requirements, according to the Bureau of Labor Statistics. This amounts to approximately 1.2% of all employer compensation expenditures, which includes wages and benefits.
Related Statistics:
- Medical losses totaled$4.6 billion, or 55% of total loss compensation, according to insurers.
- Losses were $13.2 billion, or 82% of the premium collected in 2019.
What Types of Workers Comp Claims are Most Expensive?
According to NCCI data provided by the National Safety Council, motor-vehicle accidents are the most common cause of lost-time worker's compensation claims.
A motor-vehicle workers comp claim in 2016 and 2017 had an average cost of $78,293 per claim.
The most expensive causes of injury claims in 2016 and 2017, accounting for about a fifth of all claims, were burns ($47,878), falls or slips ($46,592), and unspecified injuries.
While motor vehicle accidents account for the majority of the most costly claims due to the nature of the injury, amputation loss time claims are the most costly by definition. In 2016 and 2017, an average of $98,126 was spent on every lost-time claim associated with an amputation.
Following amputation, the most costly claims were:
- Fracture, crush or dislocation ($58,563)
- Other trauma ($55,543)
- Burns ($47,955)
Workers Compensation Claims Statistics By State
The following are a few examples of states that have published workers' compensation claims data:
- In 2020, there were 73,254 claims in Florida for an average benefit of $20,146
- In Michigan, about 20,000 people are compensated for a work-related accident or sickness each year, down from approximately 27,000 in 2007.
- In 2020, the state of Oregon collected 21,896 claims, which was 1.2 claims per 100 employees. Insurers initially denied nearly 12 percent of disabling claims.
- Texas has experienced a significant increase in claims in 2020 (99,850 claims), compared to 2019 (73,628).
COVID 19 & Workers Compensation
Can You Get Workers Comp For COVID?
Yes, according to recent research, one-quarter of all COVID-19-related workers' compensation claims were for medical expenses in 2020. Last year's average overall medical and indemnity cost of a COVID-19 workers' compensation claim was $4,320.
Related Statistics:
- Employees from the healthcare sector represented half of all COVID-19 claims.
- Between 2020 and 2021, the healthcare, transportation, and warehousing industries had the largest aggregate number of workers' compensation claims reported.
- The Healthcare, Transportation & Warehousing industries saw a 24% increase in total workers' compensation claims over 2019.
Workers' Compensation Denial Statistics
What Are The Most Common Reasons For A Workers Compensation Denial?
Between 2013 and 2017, claim denial rates increased from 5.8 percent to 6.9 percent.
The 10 most common reasons for getting a denial are:
Between 2013 and 2017, claim denial rates increased from 5.8 percent to 6.9 percent.
The 10 most common reasons for getting a denial are:
- No medical evidence of injury
- No injury per statutory definition
- Reservation of rights, which is an insurer’s notification to an insured that coverage for a claim may not apply
- Pre-existing condition
- Idiopathic condition, which means the cause is considered unknown
- Intoxication or drug-related violation
- No injury per statutory definition
- Failure to report an accident in a timely manner
- Misrepresentation
- The injured person doesn’t meet the statutory definition of an employee
You still have a decent chance of receiving compensation if your first workers' compensation claim is denied. On average, 67% of initial denials convert to paid claims within 12 months.
Workers' Compensation Fraud Statistics
Workers' compensation denials are sometimes accurate. It's tough to calculate the amount of workers' compensation fraud, however, one study put it at $1 billion a year. With fraud accounting for 1 to 2 percent of all workers' compensation payments.
In 2008 and 2009, the California Department of Insurance discovered and reported 5,174 suspected fraudulent workers' compensation claims, assigning 539 new cases, making 218 arrests, and referring 327 submissions to prosecuting authorities. The potential loss was more than $205 million during that time period, according to the Department.
Workers' compensation fraud happens to both employees and employers as well; for example:
Misclassifying employees as independent contractors to avoid paying workers' compensation premiums is another. This is especially true in the construction business because as many as 12 to 20% of workers were either misclassified or worked off the ledger.
Workers' Compensation Return-To-Work Statistics
The probability of returning to full employment after a six-month absence due to an accident or sickness is 55.4 percent.
After one year, the possibility of ever working again falls to 32.2%, and after two years unemployed, the likelihood drops further to 4.9%.
The moment when an injury or sickness becomes a long-term disability is most likely between three and six months into retirement.
Workers Compensation Insurance Statistics
How Much Are Employers Spending On Workers Comp Insurance Premiums?
Workers' compensation insurance in the United States grew by 0.8% between 2015 and 2020, according to projections by the Congressional Budget Office.
Despite lower premium rates over the same period, net premiums written increased 2.1% between 2015 and 2018.
So what does a quick breakdown by sector look like?
- For military personnel, the hourly rate was $0.46 and 1.2 percent of overall compensation for civilian employees
- $0.45 per hour worked or 1.3% of overall compensation for private sector employees
- State and government employees made an average of $0.56 per hour worked or 1.1% of total compensation, according to the Economic Policy
Naturally, high-risk businesses pay more in workers' compensation premiums than other sorts.
Who Is Writing the Most Workers Comp Insurance Premiums?
- Travelers Companies Inc. $4.3 billion
- Hartford Financial Services $3.4 billion
- Berkshire Hathaway $2.8 billion
- Zurich Insurance Group $2.7 billion
- AmTrust Financial Services $2.6 billion
- Chubb Ltd. $2.5 billion
- Liberty Mutual $2.5 billion
- New York State Insurance Fund $2.3 billion
- American International Group (AIG) $1.7 billion
- Blue Cross Blue Shield of Michigan $1.6 billion
Concluding Thoughts
Taking Action
With some 4.9 million workers' compensation claims being filed every year, having coverage is not just an important part of running your business, but it could also save you from expensive legal fees if one or more of your employees were to get injured on the job.
If you are a business owner without workers comp insurance, click here to learn about the average cost of workers comp insurance, how much coverage you may need, and how to get start coverage.
III | Breeze | Department Of Labor | Rosenfield Injury Lawyers | Get Foresight |
