EPLI - EEOC Charge Volume Falls - Is it time to finally get in the market?
The just-released 2012 EEOC charge statistics finally contain some good news for EPLI insurers. The EEOC charge data is a good barometer of employment claim activity and worth a closer look. The total number of employee charges of discrimination and retaliation declined, albeit slightly, reflecting a three-year period of relative stability. In our view, a bit of stability and favorable loss trend are welcome sights after the tough recession years - as insurers, employers and employees.
Let's begin with the best news. Total annual EEOC charges filed by employees declined by 535 - or .5% - to 99,412. That number is roughly in line with 2010 and 2011 charge volume. It might not sound like much, but consider that overall charges grew by nearly one-third during the 2006-2009 period.
Charges of Race, Religion, National Origin and even Age Discrimination fell in 2012. The last one came as a pleasant surprise to many of us, having seen so many people trying to stay in or return to the workplace in their later years. In contrast, Sex Discrimination, Disability Discrimination and Retaliation charges grew in 2012. The data surrounding Retaliation and particularly Disability Discrimination is not surprising, given recently broadened federal laws and regulations. But Sex Discrimination? This category includes sexual harassment and pregnancy discrimination, and we have not seen any major legal development explaining that increase.
There is a sobering side to the EEOC numbers, too. The new level of claim activity at just under 100,000 is still higher than that experienced before the recession. In the early 2000s, annual charge volume ranged from 75,000 to 85,000.
What does it all mean for EPLI insurers? Our sense is that a strong economy is slowing the EPLI claim engine but that new laws and active regulators will keep it running. Perhaps a new norm in charge volume is emerging somewhere between the high and low points of the EEOC data story. We do not expect to return to those lower pre-recession numbers, but we are moving in the right direction. That is fine with EPLI insurers.
As for those carriers that waited to enter the EPLI marketplace, for whatever reason, now looks like a good time to get in. If we can help you, let us know.
Read the EEOC press release to view the latest statistics.