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 January 31st 2021?

  • Reported claim counts were down significantly since the start of COVID with the exception of December 2020 and January 2021 (which were up due to a spike in COVID claims in those months).The downturn was observed across all industries, even those including businesses deemed “essential.” The stand-out points are these:
  • Medical-only claims dropped precipitously in March through May and have remained lower YoY in almost every month since COVID started aside from the COVID claim-driven surge in December 2020 and January 2021
  • Indemnity claim counts have actually increased YoY in every month including large surges in December 2020 and January 2021, despite the overall downturn in reported claim counts
  • The industry with the most stark trends is - unsurprisingly – Healthcare, where claims counts were flat-to-down initially (in 2020 Q1-2) but then spiked significantly in 2020 Q3 (27% YoY increase) and are still up 7%, 19%, 125%, and 126% YoY in October 2020 through January 2021, respectively.
  • Reported counts reached their most significant YoY decrease in the 2020 Q2 and in total are down 6.1% YoY through January 2021. Note that due to the presence of a number of large healthcare providers in our database, the appearance of the December 2020 and January 2021 reported claim spike is exacerbated. Without the large healthcare industry spike which, in turn, was largely due to COVID claims, reported claim counts would be down to a greater degree.


  • Closed claim counts were up YoY in 2020 Q2 but have been down or remained flat since then with a large drop in January 2021 of 21%. Claims closure rates have been down since the start of COVID.


  • COVID-19 infection claims as a proportion of total reported claims reached a new peak of 32% of all reported claims in January 2021, preceded by another spike in December 2020. This corresponds with the population-wide increase in COVID infections in December 2020 and January 2021. The proportion of COVID claims relative to total WC claims YTD is 15%. COVID claims as a proportion of total reported claims is highest in states with presumption laws/rules that cover all employees and, notably, 55% of reported claims in January 2021 in these states were COVID claims. Interestingly, COVID claims as a proportion of total reported claims in states with presumption laws covering first responder or extended contact exposure employees spiked in April at 45% but then has remained quite low since.
  • Newly in this report we display the age of COVID claims in months by severity bands, which shows clearly that the more severe COVID claims are staying open for longer
  • Please note that the above proportions are heavily driven by claims stemming from healthcare providers, which experienced higher-than-typical rates of COVID infection claims


  • An important finding in the data is that the ratio of indemnity claims to total claims is up significantly during the COVID months and this is putting upward pressure on loss costs. Pre-COVID, the average ratio of claims with indemnity to total claims was 20-21%. Since March 2020 this ratio has increased to between 22% and 29%.
  • 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 has increased to as high as 25% in April. Excluding COVID claims, the ratio of indemnity claims to total appeared to be normalizing somewhat in July through December 2020, but increased again to 23% in January 2021.
  • Note that indemnity claim counts have been up since Q2 2020. They surged to YoY increases of 63% and 56% in December 2020 and January 2021. Indemnity counts YTD are up 13.8%
  • This shift is manifesting in incurred loss dollars in interesting ways:
  • Due to the indemnity influence, incurred dollars since the start of COVID are not down to the degree that reported claims are. Incremental incurred losses were down fairly substantially at the beginning of COVID – namely in Q2 & Q3 2020 they were down 3.2% and 2.1% respectively. However, incremental incurred losses have been bouncing back and forth since then. Namely, losses were up 3.8% in October, down 5.0% in November, up 5.9% in December, and down 1.2% in January 2021.
  • The severity of indemnity and medical-only claims reported in the COVID-period have not changed significantly over prior months, aside from a few spikes in indemnity severity in June and October; however total claims severity is up somewhat due to the higher proportion of indemnity claims.
  • Reported Incurred” dollars – defined as loss incurred on claims reported in the month – are up YoY in June, July, September, and October with a surge in December 2020 and January 2021. Reported incurred dollars on Indemnity claims are up substantially since April, reaching a high of a 106% YoY increase in January 2021. YTD reported incurred dollars are up 10%.


  • Changes in reported claim volume across different cause of injury and injury body part since COVID began are fairly similar across all types (generally down between 60-80%) except for COVID related causes and body parts, where increases are significant.


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

Keep in mind that this data from the sixth edition of the study released to participants in April 2021, comprises about ten-and-a-half months in a COVID-19/Shelter-in-Place type environment. Trends may shift or solidify over the coming months, as subsequent updates to our study have begun to reveal. Oliver Wyman and Marsh 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 be updated monthly as claims are reported and settled.

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