Melbourne, Australia (PRWEB) March 14, 2013
Insurers assist employees recovering from workplace incidents by organising medical benefits and workers' compensation schemes. As employers' liability insurance is mandatory for many businesses, premium revenues are driven by the number of employees in the labour force and are linked to employees' remuneration. While this is a tangible measure, a less certain component of the Employer’s Liability Insurance industry’s revenue is investment income.
According to IBISWorld industry Analyst Ee Jen Lee, “in normal trading conditions, investment income can contribute up to 20% of industry revenue”. However, when financial markets sour, as experienced in 2008-09, industry revenue can plummet.
Despite the difficult trading conditions, the industry is expected to grow by an annualised 5.3% over the five years through 2012-13. The equity markets rally in 2012-13 is expected to nudge industry revenue up by 5.0% from the previous year, to $13.9 billion.
The number of incidences per 1,000 workers has gradually fallen over the past five years and is expected to trend downward through 2017-18. Due to more stringent work safety practices and lower work safety risks, average premium rates have fallen. The number of individuals entering the workforce will offset these effects to ensure sustainable premium growth.
“A growing challenge for insurers is structural change within the economy, with the manufacturing sector going into decline”, says Lee.
Recognising the inevitability of Australia's transition to a service-based economy, insurers will need to understand the risks prevalent in service industries. This adds to the challenge of operating in an increasingly unpredictable economy, where equity markets can surge and then spiral downwards.
The largest players in the Employer’s Liability Insurance industry are the statutory authorities of various Australian state governments. The four largest players are the WorkCover Authority of New South Wales, the Victorian WorkCover Authority, WorkCover Queensland and the WorkCover Corporation of South Australia.
For more information, visit IBISWorld’s Employer’s Liability Insurance report in Australia industry page.
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IBISWorld Industry Report Key Topics
This industry underwrites (i.e. assuming the risk and assigning premiums) workers' compensation insurance, which protects businesses from liabilities relating to injuries at the workplace. This industry excludes self-insurers.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
Technology & Systems
Regulation & Policy
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