For years, Texas Mutual has been the leading provider of workers' compensation insurance in Texas with over 40% of all policies issued in the state. However, as Texas continues to grow, other insurance companies see opportunity and are offering some of the most competitive workers’ compensation rates in history. While lower prices are good, it’s something every buyer should intelligently consider.
Have the attractive rates caught your eye? Here are a few things you should know before changing workers’ compensation providers.
Texas: An Enticing Market for Providers
Texas is an attractive market for several reasons. We have a healthy, stable economy with record population growth, new construction, jobs and a number of well-performing industries. Insurance companies see this opportunity and are aggressively trying to buy market share to take business away from incumbent carriers.
This competition sparks a buyer’s market in terms of price. While we can all appreciate the opportunity to save money, many offers are short-lived deals. Often companies offer attractive signing deals with one to two years in savings and raise prices later.
Tips for Selecting a Workers’ Compensation Provider
Two things come to mind when a client asks what they should consider when selecting a new insurance provider. The first is researching the new carrier and evaluating existing relationships.
- Look into the history and record of the insurance company you are considering. How long have they been around? How long have they been writing comp in the state of Texas? Do your due diligence to ensure you are choosing a credible, long-standing company with experience in workers’ compensation.
- Evaluate your existing relationships. Don’t underestimate the power of your relationship with your current carrier. Your current provider could meet all your needs.
Consider this: if you have been with your current provider for 15 years and are thinking of transitioning to another carrier, don’t just look at the current price. Think forward. What happens if you make the decision to leave the good, long-term relationship, your claims do not perform well, and you have a negative loss ratio? Would you be treated better with your long-term provider?
About the Author
Partner, VP of Commercial Lines