As technology, regulation and changing workforce dynamics continue to evolve, it can be difficult to keep pace with the necessary tasks professionals in the workers’ compensation and insurance industries need to manage.

In an attempt to keep track of the industries and regulations impacting workers’ comp, Sedgwick created a list of trends employers, risk managers, human resources professionals and insurance carriers should be watching as 2020 progresses. 

Labelled “Conversation Threads,” the site lists nine trends the company itself will be watching throughout the year and into the new decade. 

1)  Partnering Digital Technology with the Human Experience

From cloud-based technology that alerts consumers when there’s a product recall to self-service tools that help injured workers track their claims, new technologies are reshaping the insurance industry and prioritizing the client experience. 

These new digital technologies, however, are best put to use when they consider how to prioritize the human element. 

In other words, is automating some of these processes for consumers making the claims process easier or more difficult for them?  

2) Creating Cultures of Care

Empathy and compassion are quickly becoming requirements for the insurance and workers’ compensation industries. 

Employers are learning that keeping people healthy and happy is about more than just their physical and mental health. 

Financial health, and its impact on workers’ physical and mental health, is also being considered by employers, according to Sedgwick. 

In the workers’ compensation space, drug formularies, increased use of physical therapy and a renewed focus on behavioral health are being used to reduce problems associated with addiction and opioid use. 

A focus on worker and consumer advocacy is helping companies lower their litigation rates, and Sedgwick’s report stated that many employers are shifting to using prevention as a litigation management strategy.   

3) Break Down Barriers to Care

As a global health care worker shortage reduces the number of providers, access to care will become a top issue for the workers’ compensation industry. 

A variety of digital solutions, like telemedicine, and increased care options, like acupuncture or physical therapy, can help lessen the effects of the shortage. 

Additionally, many in the workers’ comp community are turning to solutions that help shorten administrative processes and reduce wait time between appointments.  

Concierge health care services are also making it easier for those with casualty and disability claims to make their day-to-day life and medical care easier. The services can help patients with anything from getting to and from doctors appointments to finding back up childcare and helping with grocery shopping.

4) Regulatory Changes Create Compliance Problems

The ever-changing legislative and regulatory environment makes it hard for employers to stay on top of compliance. This is especially true if a business practices in multiple states where regulations differ. 

Workers’ compensation and paid leave laws are changing rapidly and employers need to stay up-to-date on the changing state regulations. It’s not enough for workers’ compensation and insurance professionals to just pay attention to new laws intended to regulate their industries.

However, they also need to watch out for regulations that may reverberate into the industry. 

New laws, like California’s Assembly Bill 5 and the new consumer privacy law, which targeted tech and gig economy employers, are expected to have unintended consequences for the workers’ compensation and insurance industries.  

5) Preparing for the Unexpected

From nuclear verdicts to the increasing volatility of storms due to global climate change, businesses need to be prepared to mitigate all kinds of unexpected risks. 

Gun violence, accusations of impropriety and natural disasters are all areas where businesses need to be prepared both pre- and post-loss.  

While the opioid trials, gun violence and other high-profile cases have gotten a lot of media attention, it is marine exposures that Sedgwick highlights as being particularly at risk for unexpected claims. 

Environmental liability, international and domestic maritime laws and autonomous technology account for several factors that make marine risk challenging to mitigate.    

6) Digital Technologies Transforms the Claims Process

Don’t expect the claims process to remain relatively unchanged over the next decade, or even the next year.

Artificial intelligence is becoming so sophisticated that it can now comb through claims data and suggest ways claims administrators can take action. 

App-based health tools and telemedicine solutions can also help injured workers feel connected throughout the claims process in workers’ comp. 

As the industry becomes more digital-oriented, it will be important for dated infrastructure and technology to be updated.   

7) Be Prepared to Recover Quickly After a Claim

For many organizations, disaster recovery preparations can be a blind spot, but they’re often key to recovering from an unexpected claim. 

Whether these incidents are natural disasters or cyber attacks, businesses need to prepare or they risk becoming vulnerable to additional costs associated with business interruption.

Being prepared to address employees’ mental health concerns after a violent or traumatic incident in the workplace should also be top-of-mind for employers. 

After a disastrous event, employees could have behavioral health issues that inhibit their abilities to return to the work site. If counselling services are available and if the company has a plan for handling the event, this can lessen the trauma employees may experience.   

8) Changing Workforce and the Talent Shortage

Workforce demographics are shifting as the industry grapples with a talent shortage and an aging workforce.

With four generations currently in the workforce, it’s no surprise that the insurance and workers’ compensation industry are navigating the vastly different needs of their employees. 

If your company has predominantly older workers, you’re probably seeing and increase in health care spending as chronic conditions can drive up costs. The good news is that older workers are often safer, so while your health care costs might be going up, you could see fewer workers’ compensation claims.

A predominantly boomer workforce isn’t sustainable, however. Many older workers are approaching retirement age, and there isn’t enough younger workers to fill their places.

Yet, if your office is looking younger, not older, your company is likely facing challenges of its own. 

Younger workers are more likely to value flexibility in their employment, such as the ability to work from home, and they’re more likely to engage in the gig economy. With laws, such as California’s Assembly Bill 5 looking to classify more gig economy workers as employees, younger employees could come with their own legal risks. 

9) Elections, Climate Change and Cyber Threats, Oh My!

The geopolitical climate brings its own risks into 2020. 

The 2020 elections in the U.S., in which not only the presidency but also the entire House of Representatives will be up for grabs, could bring changes to regulatory environments.  

Climate change may bring about an increase in liability litigation as worsening storms have people questioning whether major corporations are to blame for the global crisis. 

As technology continues to evolve, cyber risks will become more prevalent. Driverless cars, the Internet of Things and biometric data developments could leave individuals and companies more vulnerable to cyber attacks. 

The insurance industry should keep all these trends on the radar as we head into 2020. &