COVID-19 Claims Trends Spotlight Update

Oliver Wyman and Marsh have undertaken an important project to assess and share the impact of the novel coronavirus pandemic on U.S. workers’ compensation losses. The COVID-19 Impact Study aggregates data from over one hundred organizations across numerous industries and geographies, with thousands of monthly claims to inform statistics on workers’ compensation losses. This information can help you confirm what you see anecdotally in your own experience and enable responsive loss forecasts during these uncertain times.

While the study with detailed results is only available to participants, below is a high-level summary to give you a sense of the valuable analysis that we can provide. If you would like to become a participant in this ongoing study and fully unlock the insights and data aggregated by Oliver Wyman actuaries, please fill out this form.


What effects do we see on workers’ compensation claims through December 31, 2021?

COVID-19 infection claims

The following important items can be observed in the data:

  • COVID WC claims represent 9.74% of WC claims in total since March 2020.
  • The proportion of COVID-related claims is highest in states with the broadest presumption laws.
  • The average size of a COVID WC claim, excluding claims with no value, is $4,854.
  • 98% of claims are less than $50,000 and 95% of claims are less than $10,000.
  • Large COVID claims (greater than $50k) are staying open for an average of 13.3 months. In general, the more severe the COVID claim, the longer it stays open. Given the immaturity of the data, the average open time is likely to increase.
  • 5 COVID claims in the database are over $1M in incurred losses and 10 are over $500,000. This represents a very small proportion of all COVID-related claims in the database, but also indicates that there is a potential for very large claims.

Reported claims

Reported WC claims have been down significantly since the start of COVID. The downturn is observed across all industries, even those including businesses deemed “essential.” The stand-out points are these:

  • Total reported claims were down 7.4% in 2020 over 2019 and were down 4.5% in 2021 over 2019 levels.
  • Medical-only claims dropped precipitously in 2020 Q2 and have remained lower YoY in almost every quarter since COVID started. They were down 10.8% in 2020 YoY and down 8.9% in 2021 over 2019 levels.
  • Interestingly, indemnity claim counts have been up in every period since COVID started with 2020 levels up 4.6% over 2019 and up 10.8% in 2021 over 2019. This is one of the more interesting call-outs of this study and is partly due to the fact that most COVID-infection claims involve an indemnity component.
  • Reported claims increased in the healthcare sector, and were relatively unchanged in Food and Beverage, but very significant drops were experience in Transportation and Other industry segments.

Closed claims

Closed claim counts have been down significantly since the start of the pandemic, with 2020 down 10.3% and 2021 down 7.6% over 2019 levels. The most significant drops were in Transportation.

Claims closure rates

Another important finding of our study is that rates of claims closure have been down consistently since the start of the pandemic and have not returned to pre-pandemic levels. This is likely due to a few factors including a changing mix in the maturity of claims, a slow-down in the ability to process claims and resulting back-logs and resignations of claims adjusters.

Injury Distribution

As expected, there was a significant shift in the distribution of claims reported related to infectious disease, due to COVID. Prior to the pandemic, less than .1% of claims were infectious disease claims and since March 2020, that ratio has risen to 5%. Aside from infectious disease claims, however, there have not been significant shifts between pre and post pandemic distribution of claims by injury-type or body part.

Claim Type Distribution

An important finding in the data is that the ratio of indemnity claims (those with lost wages) to total claims is up significantly during the COVID months and at least temporarily put upward pressure on loss costs. Pre-COVID, the average ratio of claims with indemnity to total claims was 21-23%. Since March 2020 this ratio has increased to between 25% and 29%. In the last few months of 2021, this ratio seemed to plateau at about 25%.

  • The presence of COVID claims is influencing this phenomenon. A finding so far is that many COVID infection claims are “indemnity only” and many at least involved a component of indemnity, given that infected workers must quarantine and are not able to return to work.
  • However, this trend exists even when excluding COVID-19 infection claims. Without COVID claims, the ratio increased to as high as 26% in April 2020. Excluding COVID claims, the ratio of indemnity claims to total appeared to be normalizing somewhat since the early months of the pandemic.

Incremental Incurred Losses

  • Incremental incurred losses were down fairly substantially at the beginning of COVID by 7.3% and 6.6% in Q2 and Q3 of 2020, respectively. However, incremental incurred losses have been steady-to-up since then. For the whole of 2020, incremental incurred losses were down 3.8% YoY and in 2021 they were up 8.0% over 2019 levels.
  • Industry specific results are notable, however, as can be seen in the graphs. Healthcare saw significant increases in incurred losses during the pandemic, while Transportation experienced significant decreases.
  • Following with observations of claim counts discussed above, incremental incurred losses on claims involving indemnity experienced increases, while in 2020, incremental incurred losses on medical-only claims decreased substantially. This reflects cost-shifting due a higher proportion of claims involving indemnity.

“Reported” Incurred Losses (Graph Set VIII)

Reported Incurred losses - defined as loss incurred on claims reported in the month - surged significantly in 2020 Q4, and continued to come in at increased levels in the 1st and 2nd quarters of 2021 and experienced another spike in the 4th quarter of 2021.

Average Age of Open Claims

The average age of an open claim appears to have increased by approximately 2 months since the start of COVID.


Oliver Wyman created the COVID-19 Impact Study to help our clients navigate the turbulence caused by COVID-19 on their claims experience, and we intend to be partners working with them throughout the length of the entire process. The study will continue to be updated regularly.

We encourage any entity with U.S. workers’ compensation exposure to consider participating in this ongoing study. As a participant, you will have access to detailed metrics around claim frequency, severity, and duration and the distribution of claims by type. All that is required from participants is submission of claims runs each month. All data will be strictly anonymized.