Tag Archive | Risk Management
December 20, 2025  

California Workers’ Compensation Market Is Hardening

After nearly a decade of soft market conditions and falling premiums, California’s workers’ compensation landscape is experiencing a significant shift.

According to multiple industry sources, including the 2026 US Workers’ Compensation Market Outlook from Risk & Insurance, California’s combined loss ratio reached 127% in 2024. This is the highest level in more than two decades. That means carriers are projected to pay $1.27 in losses and expenses for every $1.00 in premium earned which is triggering a rate response and stricter underwriting practices.

Because California represents nearly 25% of the national workers’ compensation market, what happens here influences pricing, underwriting, and coverage trends nationwide.

Why California Costs Are Rising

Several key factors are currently reshaping the workers’ compensation landscape in California according to Risk & Insurance:

  • Medical and Legal Cost Inflation: Rising medical pricing, medical-legal billing charges, and indemnity costs are driving severity higher.
  • Cumulative Trauma Claims: CT claims now account for nearly 25% of California indemnity claims, far above national averages, increasing claim complexity and cost.
  • Remote Litigation (“Telelegal”): Virtual hearings have expanded litigation activity statewide, increasing defense costs and frequency.
  • Wage Inflation: When wages go up, workers’ comp benefits increase too, especially disability payments, and it’s even more noticeable with California’s minimum wage increases.

These combined influences have reversed the pattern of declining rates, resulting in increased premium expenses across the state.

How This Is Changing Underwriting

Carriers are tightening their approach and returning to more disciplined underwriting including:

  • Higher minimum premiums
  • Fewer discretionary credits
  • More frequent debits on experience mods
  • Net renewal increases of 20% or more, even on clean accounts

Here’s my advice for California employers and their 2026 workers’ comp renewals:

  • Start early: 90+ days before expiration
  • Review loss runs and reserves carefully: inconsistencies can be costly
  • Clearly describe your risk management strategies, focusing on your safety programs and return-to-work protocols for employees.
  • Check your payroll and class codes: small mistakes can lead to significant costs

As your broker, I am committed to a proactive, strategic approach to your workers’ comp renewals, going beyond reactive tactics. This allows us to address potential issues upfront, ensuring the best outcomes for your business.

By working together, we can create impactful risk narratives, making your work comp insurance more desirable for underwriters. We can also adopt a proactive strategy to uncover cost-effective solutions through audits and in-depth reviews of safety documentation, guaranteeing the most favorable pricing and coverage.

Workers’ comp in California is at a turning point and the employers who plan ahead will be the ones who control cost, maintain coverage, and avoid last-minute surprises in 2026.

October 28, 2025  

Why Your Commercial Auto Insurance Is Increasing

If your business owns or operates company vehicles, you’ve definitely seen your commercial auto insurance premiums rise in recent years. Whether you have a a few vans for deliveries, many service trucks, or a small sales fleet, your business is not immune to the rising commercial auto insurance costs.

You’re not alone. Across the country, insurers are reporting double-digit increases driven by several economic and behavioral trends. But understanding why rates are rising is important. Knowing what you can do to control your costs is crucial. This knowledge can make a big difference for your bottom line.

Here’s what’s driving 2025’s auto insurance market, based on Travelers’ recent analysis of national trends.

1. The Cost of Accidents Keeps Rising

Medical costs, vehicle repair costs, and legal expenses have all climbed sharply. Even a minor fender-bender now costs thousands more to settle than it did a few years ago.

What you can do:

  • Make driver safety a non-negotiable part of your business culture.
  • Review your loss-control programs regularly.
  • Implement driver training and enforce policies for seatbelt use, mobile phone restrictions, and safe following distances.

2. Lawsuits Are Bigger and More Frequent

“Nuclear verdicts” — jury awards exceeding $10 million — are now more common. Even small claims often involve higher legal fees and settlements.

What you can do:

  • Make sure your liability limits are sufficient; a $1M policy might not go as far as it once did.
  • Consider adding an umbrella policy to protect against catastrophic claims.
  • Document all driver training, vehicle inspections, and maintenance — this can be critical in defending a claim.

3. Distracted Driving Is a Growing Problem

Cell phones, dashboard screens, and in-cab tech have created more opportunities for driver distraction. Even one distracted-driving claim can significantly impact future premiums.

What you can do:

  • Adopt a written distracted-driving policy — and enforce it.
  • Use telematics or driver-monitoring tools to track unsafe behavior.
  • Reward safe driving performance and make accountability part of your company culture.

4. Newer, Less-Experienced Drivers Mean More Risk

The national driver shortage has forced many businesses to hire younger, less-experienced drivers. Unfortunately, accident data shows that inexperience leads to more claims.

What you can do:

  • Require new hires to complete safety orientation before driving company vehicles.
  • Pair newer drivers with seasoned employees for mentorship.
  • Review MVRs (motor vehicle records) regularly and establish clear standards for eligibility.

5. Vehicle Repair and Replacement Costs Have Soared

From supply-chain disruptions to advanced vehicle technology, repairs are simply more expensive. A cracked sensor-filled bumper can cost thousands to replace — and insurance reflects that.

What you can do:

  • Keep vehicles well-maintained and up-to-date with safety systems.
  • Install anti-theft devices to deter catalytic converter theft.
  • Evaluate whether certain vehicles should be replaced or removed from service.

6. Third-Party Drivers Can Create Hidden Liability

If your company uses contractors, delivery partners, or outside carriers, you could be held responsible if they’re involved in an accident. This is true even if you don’t directly employ them.

What you can do:

  • Verify that all vendors and contractors carry proper insurance.
  • Require certificates of insurance and written hold-harmless agreements.
  • Review contracts annually to ensure you’re protected from vicarious liability.

How to Take Control of Your Auto Insurance Costs

You can’t control market inflation or national loss trends — but you can control how your business manages risk. Insurers reward companies that demonstrate strong safety programs, driver accountability, and proactive fleet management.

Here’s how to start:

  • Review your coverage limits and deductibles annually.
  • Implement or update your driver safety program.
  • Track claims trends and address root causes early.
  • Work with a broker who can advocate for your business and negotiate terms based on real risk improvements.

Final Thoughts

Commercial auto insurance is one of the most volatile segments in today’s market. However, informed and proactive business owners can keep costs in check. If your company operates vehicles or relies on drivers to serve clients, now is the time to strengthen your risk management approach.

Contact me to discuss ways to reduce your exposure. This will put you in a stronger position for your next renewal.

-JK

August 21, 2025  

California Workers’ Compensation: First Rate Increase in a Decade

For the first time in 10 years, California’s workers’ compensation rates are increasing.

The state has approved an 8.7% rate increase, driven by sharply rising claim costs and industry-wide financial strain.

The Workers’ Compensation Insurance Rating Bureau (WCIRB) projects the 2024 Accident Year Combined Ratio at 127%. This is the highest ratio since 2001.

Put simply, carriers are paying out $1.27 for every $1.00 of premium collected, which is unsustainable without pricing adjustments.

Why Are Costs Rising?

There are three major culprits behind the jump in workers’ compensation costs:

  1. Cumulative Trauma (CT) Claims
    CT claims are injuries that occur over time rather than from a single incident. They are rising rapidly. These claims are more complex, harder to close, and often stay open for years, adding significant cost to the system.
  2. Rising Medical Costs
    After years of stability, medical costs turned sharply upward in the past year. Factors include higher provider charges, more advanced (and expensive) treatments, and longer recovery times.
  3. Increased Litigation
    Loss adjustment expenses are climbing as litigation becomes more common. Disputes over claims often extend case duration’s and increase settlement values.

Together, these trends are straining the workers’ comp system. Unfortunately, employers will start to feel the impact as a result. It shows in the form of higher premiums.

What This Means for Employers

If you’re a California employer, expect workers’ comp pricing to firm in the coming policy renewal cycles. While legislation may eventually need to address systemic cost drivers, the immediate impact is higher insurance costs.

Now [and always] is the time to:

  • Focus on claims prevention: Invest in workplace safety programs and early intervention for injuries.
  • Review your claims history: Cumulative trauma claims often arise when small issues aren’t addressed quickly.
  • Work with an experienced broker: Having the right advocate can help you navigate pricing changes. They can also help you in exploring coverage options. Additionally, they implement risk management strategies to control costs.

My Take

While rate increases are never welcome news, disciplined carriers and proactive employers can still manage costs effectively. As your broker, our role is to help you stay ahead of these changes. We control risks and make sure you’re partnered with carriers who remain stable, consistent, and service-oriented. This is crucial in a hardening market.

-JK

November 11, 2024  

OSHA’s Top Ten Safety Violations for 2024

As OSHA unveils the 2024 list of its 10 most frequently cited safety violations, there are no surprises at the top once again. For the 14th consecutive year, Fall Protection came in at number one with 6,307 violations. It is far and away the most commonly cited standard following inspections of worksites for all industries. Hazard Communication was next at 2,888, followed by Ladders and Respiratory Protection.

OSHA’s 2024 Top 10 Safety Violations:

1- Fall Protection – General Requirements (1926.501) – 6,307 violations
2- Hazard Communication (1910.1200) – 2,888 violations
3- Ladders (1926.1053) – 2,573 violations
4- Respiratory Protection (1910.134) – 2,859 violations
5- Lockout/Tagout (1910.147) – 2,443 violations
6- Powered Industrial Trucks (1910.178) – 2,248 violations
7- Fall Protection – Training Requirements (1926.503) – 2,050 violations
8- Scaffolding (1926.451) – 1,873 violations
9- Personal Protective and Lifesaving Equipment – Eye and Face Protection (1926.102) – 1,814 violations
10- Machine Guarding (1910.212) – 1,541 violations

Do you need safe workplace resources like safety consultations, risk assessments, safety training webinars, or instructional videos? Contact me today. I have relationships with Risk Management consultants on how to be OSHA compliant.

-JK

September 19, 2024  

Build Your Injury and Illness Prevention Program: Easy Tool for California Employers

All California employers are required to create an Injury and Illness Prevention Program (IIPP) that’s tailored to their business and accessible to all employees.

The State Compensation Insurance Fund offers a no-cost, easy-to-use Injury and Illness Prevention Program IIPP Builder℠. Also, to make it easier for companies with Spanish-speaking employees, this is now available in Spanish too.

The tool is available to all California businesses, regardless of whether they are a State Fund policyholder. It’s easy to switch between English and Spanish, and offering a program in the preferred language of Spanish-speaking employees can help business owners create a culture of safety in their workplace, reduce the risk of injuries, and promote healthy practices.

I provided the links above, but to create an IIPP in English or Spanish, visit www.SafeAtWorkCA.com, then simply create an account and follow the prompts to build and save a customized program.

State Compensation Insurance Fund policyholders can log in to create and save their Injury and Illness Prevention Program then return to revise, update, or translate it whenever they need to.

Of course, building your own IIPP isn’t ideal for all businesses. Some are more complex and need the help of a dedicated safety consultant.

If your business needs help building a tailored Injury and Illness Prevention Program, contact me for resources and referrals to help with this. I have many.

-JK

August 28, 2024  

First Year Workers Account for 40% of Workers Compensation Claims

Workers who have been employed for less than a year are responsible for almost 40 percent of all workers’ compensation claims – according to the Workers’ Compensation Insurance Rating Bureau of California (WCIRB). This is staggering if you ask me. 40%?!!

There are many reasons that can lead to this statistic. Employee inexperience, unfamiliarity with workplace hazards and insufficient training to name a few.

The good news is, there was ways to help you ensure the safety of your new employees, preparing them properly for the workplace, preventing incidents and lowering claims.

Here are 7 proactive steps you can take to ensure the safety of your new employees. Actually, for ALL employees, but the emphasis here is the new employees who statistically show to be at higher risk:

1 – Comprehensive Onboarding and Training

Implement thorough onboarding programs that include detailed safety training. Make sure new employees are well-versed in workplace hazards, proper equipment use, and emergency procedures.

2 – Mentorship Programs

Create a supportive environment by pairing new employees with experienced mentors. These mentors can guide them through the job’s safety aspects and offer ongoing support, making them feel less isolated and more confident in their roles.

3 – Safety Culture Promotion

Foster a strong safety culture where employees feel comfortable reporting hazards and unsafe conditions without fear of retaliation

4 – Regular Safety Audits

Conduct regular safety audits and risk assessments to find and address potential hazards that affect new workers.

5 – Ergonomic Assessments

Make sure workstations and tasks are ergonomically designed to reduce strain and prevent injuries, particularly in industries like construction and restaurants where physical strain is common.

6 – Clear Communication

Keep open lines of communication about safety expectations and procedures. Encourage employees to ask questions and seek clarification on safety matters.

7- Adjust Workloads

Gradually increase the complexity and intensity of tasks assigned to new employees to allow them to build experience and confidence without overwhelming them

Proactively implementing these strategies significantly contributes to a safer work environment, reducing injuries among first-year employees and showing your commitment to their well-being.

But I want to emphasize, make sure you’re focusing on the safety and wellbeing of ALL employees. This creates a safe, positive work environment that can save a ton on operational costs by keeping your Experience Modification Rating DOWN.

I’m here to help!
if you have any questions or concerns, please contact me at jkinmartin@olsonduncan.com

Thanks for reading

-JK

January 24, 2024  

Employment Practices Liability Insurance – Hindsight is 20/20

Today my client forwarded me a letter received in the mail from an Employment Law Firm alleging the following from a former employee:

👉 Retaliation
👉 Discrimination
👉 Harassment
👉 Failure to Provide Meal Periods
👉 Failure to Provide Rest Breaks
👉 Failure to Issue Accurate & Itemized Wage Statements
👉 Failure to Indemnify
👉 Failure to Provide Wages Due Upon Termination

-Client: “Does this fall under any insurance we have?”

-Me: “This unfortunately doesn’t fall under general liability or work comp. This would be under Employment Practices Liability Insurance which we touched on back in June.”

You see, together we went through the process of completing an application and taking it out to market for quotes seven months ago.

Pricing came in between $19k-$25k annually depending on the limits and retention/deductible chosen.

Due to the cost, my client elected to pass this time around.

Hindsight is always 20/20, but I am afraid this allegation is going to result in an expense for my client that will significantly eclipse the annual premium and retention that ultimately would have been paid for an EPL insurance policy quoted last June.

EPL is one of those coverage’s I cannot recommend enough, especially in this litigious hotbed of Southern California.

In my 16+ years in this profession, I have told this story more times than I can count with my fingers and it’s a terrible feeling to have to explain this in a time of need.

Managing people is arguably the toughest part of running an business.

I encourage you not to overlook Employment Practices Liability insurance for your organization. This area of coverage is NOT included within a Workers Compensation or General Liability insurance policy. It is a separate policy in itself.

September 13, 2023  

MGM Cyber Hack Has its Las Vegas Hotels Resorting to Cash Bars, Paper Vouchers

MGM Resorts International is a large publicly traded company with billions of dollars of annual revenues. So, reading the news about the cyber attack they’re currently facing might have you thinking that something like this only happens to those large, multi-billion publicly traded companies.

The reality, however, is that ALL businesses in today’s world, large and small, are exposed to cyber attacks in some way, shape of form.

First, a quick update to what’s going on here:

News like this takes center stage do to the notoriety of MGM Resorts International. However, let this be a lesson that the issues that MGM is facing are the same issues everyday main street businesses face from a cyber attack, just on a smaller scale.

Think about the repercussions of this cyber attack. Here’s a list to get you thinking:

First Party Damages

  • Loss of electronic data: the cost to repair damaged software or replace lost or stolen data from the cyber attack.
  • Cyber extortion: cyber criminals holding data and/or information hostage for a ransom; cost to help pay for the ransom.
  • Business interruption/loss of income: a data breach or cyber attack leaves you unable to operate your business. The lost income and expenses add up fast here.
  • Security fixes and cyber forensics: Costs of upgrading your security and investigating the data breach.
  • Notification and identity protection for affected customers: Cost of notifying customers impacted by data breaches and paying for identity protection.
  • Fraud and credit monitoring services: Cost of credit monitoring for any customers impacted by a data breach.
  • The impact on your business reputation: Costs of handling public relations and repairing the damage to your business reputation. Libel, copyright infringement, defamation.

Third-Party Liability

  • Damage to a third-party system (in case of an accidental virus transmission, for example)
  • Network Security and Privacy Liability: Liability for alleged negligence or that you failed to properly protect customer information.
  • Media Liability Claims: This includes accusations of libel, slander, fraud, etc.
  • Regulatory proceedings and or fines form regulatory bodies
  • Legal costs, settlements, and damage awards

So, what if this happened to your business tomorrow? You come to work in the morning and realize that you’re locked out of your entire network and not a single employee can get a single task done.

You have a ransom demand of $400,000 from a hacker.

Where do you start? Are you capable of doing this all alone? To pay the costs out of pocket? To deal with the IT forensics and loss of data? The network fixes and trying to get back to where you were before you shut down the night before?

If this reality hits you hard in the face, cyber liability/data breach insurance coverage is something you should consider to address these very circumstances.

Cyber insurance programs can team up with your managed IT provider to help with the list of costs and expenses to navigate through the mess caused by a cyber attack. And carriers have deep resources to help fix the mess and get you back to business much faster and more efficiently than trying to deal with this sort of mess alone.

There are many cyber insurance options out there. No two are the same. It’s important to work with a provider who knows the ins and outs of cyber insurance coverage.

Contact me today if you have questions about cyber insurance or would like to look at coverage and cost options.

Let’s hope that MGM gets this settled as quickly as possible for all involved.

August 10, 2023  

Hired and Non-Owned Auto Liability Best Practices

As a business you may rely on your employees to run errands on your behalf, visit customers or clients, or even rent vehicles for business purposes.

Consider this, a business has outside sales reps driving their own personal vehicles to make sales calls and visit customers.

One salesperson was driving their vehicle to visit a customer when she hit the stopped car in front of her at an intersection. The sales rep was cited for the accident. A lawsuit was filed by the injured party naming both the salesperson and her employer as defendants.

The salesperson’s personal auto carrier provided defense for her and the businesses hired and non owned auto insurance coverage provided defense on behalf of the business/her employer.

Now consider this, before you sent the salesperson out to the sales appointment on behalf of your company, you did not take the time to make sure that your employee had adequate personal auto insurance.

The driver of the vehicle your employee struck suffers major injuries and will require significant medical and therapeutic treatment and your employee driver does not have the personal auto liability limits to help cover the injured parties medical expenses.

Many states have requirements when it comes to having personal auto insurance but what practices and requirements should your organization have in place to adequately protect you from financial and reputational loss?

Here are four ways to make this safe play to help protect your organization and your drivers:

1- Create a plan for running motor vehicle records or MVR’s. The plans should require that you:

  • Run MVR’s at the time of hire or before you allow an employee to drive on your company’s behalf.
  • Run MVR’s at least annually for employees that drive regularly.
  • If your organization participates in a monitored driver safety program MVRs should also be obtained on drivers who exhibit repeat driving offenses.

2- Determine MVR acceptability. In general, drivers with more than two minor moving violations in the last three years or drivers with any major moving violations in the last five years should be considered ineligible.

3- Verify adequate personal insurance limits at least annually. All drivers who drive their vehicles on your behalf should maintain the insurance limits of at least 100/300 thousand personal auto liability limits.

4- Train your staff on appropriate driving behaviors. Your specific training needs depend on vehicle type, use, and frequency but all drivers that drive on your behalf should receive annual distracted driving training at a very minimum.

Help make your employee drivers safer on the road so you can maintain focus on your businesses primary mission. A simple company errand or routine driving by employees on behalf of your company can be a major risk exposure for your business.

Need help developing a Hired and Non-Owned Auto Liability Best Practices plan for your business? Contact me today for resources.

April 14, 2023  

2023 Distracted Driving for Business [Infographic]

The 2023 Travelers Risk Index finds that employees use their phones when they are behind the wheel, which may contribute to distracted driving behaviors.

In fact, most employers (87%) expect their employees to respond to work-related messages when they are out of the office during work hours.

And 44% of employees who take work-related calls while driving do so because they believe they always need to be available for work.

Business managers can help PUT A STOP to this dangerous behavior by communicating and reinforcing driving policies, speaking up when a colleague is driving distracted, and not calling employees when they know they are behind the wheel.

This is a huge liability for any company with vehicles on the road!

According to the National Highway Transportation Safety Association, the total economic impact of motor vehicle accidents was $340 billion in 2019, the equivalent of approximately $1,035 for every person living in the United States. Here’s a look at key findings from the 2023 Travelers Risk Index and how a distracted driving policy can help businesses.

2023-business-distracted-driving-infographicDownload
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