Employers' 2025 Q2 Earnings Call: Unpacking the Contradictions in Cumulative Trauma Claims and Actuarial Trends

Cumulative trauma claims and their cause, actuarial trend selection and reserve management, the emergence of cumulative trauma claims, the impact on reserves and pricing actions, and industry trend consistency are the key contradictions discussed in Employers' latest 2025Q2 earnings call.



Premium Revenue and Market Strategy:
- Employers Holdings reported gross written premium decreased by 2.2% to $203.3 million for Q2 2025 compared to the previous year.
- The decrease was primarily due to a decline in new business written premium within the middle market, reflecting a focus on profitability and targeted underwriting actions.

Accident Year Loss Reserve Developments:
- The company reported a current accident year loss and LAE ratio on voluntary business of 69%, an increase from the previous quarter's 66%.
- This increase was in response to a rapid rise in cumulative trauma claims in California and the level of uncertainty surrounding this trend.

Capital Management and Share Repurchases:
- Employers Holdings repurchased $23 million of its common stock in Q2 and an additional 229,365 shares in Q3, at average prices of $48.08 and $46.44 per share, respectively.
- The capital management strategy aims to support organic and inorganic growth investments in technology while maintaining excess capital to navigate emerging trends.

California Cumulative Trauma Claims:
- The California Insurance Commissioner approved an increase in rates to address rising cumulative trauma claims, with an 8.7% increase effective September 1, 2025.
- The increase was driven by factors such as medical loss development and an increase in claim frequency, particularly in CT claims, leading to strategic actions by the company in underwriting and claim management.