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NCCI ASB Rebuilds WC Paid Tail Benchmarks for Buyers

NCCI's 2025 Annual Statistical Bulletin changes how paid age-to-ultimate factors are calculated in Exhibit 9. For self-insured workers compensation buyers, the reserve angle is whether paid-method tails in recent reserve reviews still fit the new direct paid benchmark.

By Sam, EditorJune 2026 · 3 min read

In the 2025 Annual Statistical Bulletin, posted by the National Council on Compensation Insurance (NCCI) in late June 2026, Exhibit 9 changes a small but important workers compensation paid loss development benchmark. Beginning with the 2025 edition, NCCI says paid age-to-ultimate factors, including the 19-to-ultimate tail, are calculated directly from paid loss experience for every state where NCCI provides ratemaking services.

That is different from prior editions, where paid age-to-ultimate factors were derived from case-incurred age-to-ultimate factors using the applicable ratio of paid to case-incurred losses. Case-incurred means paid losses plus case reserves. For a buyer, the distinction matters because paid data is not contaminated by a TPA’s case reserve philosophy, while incurred data can move when adjusters strengthen or weaken case estimates.

Who it affects

This affects self-insured employers and public entities that benchmark workers compensation paid development against NCCI data: manufacturers, health systems, universities, municipalities, retailers, and construction groups with retained WC layers. It also affects captive and pool boards that receive both paid and incurred indications in a workers compensation IBNR review.

The caution is structural. Exhibit 9 says the underlying financial data excludes experience from large deductible policies, so the NCCI pattern is an external benchmark, not a mirror of large-employer retained risk. Use it to test your selected tail, not to replace your own triangle.

The reserve mechanism

The lever is the paid development pattern and the paid tail factor. In a chain ladder indication, the selected cumulative development factor turns paid-to-date losses into projected ultimate losses. In a paid Bornhuetter-Ferguson diagnostic, the same pattern controls the paid percentage used to estimate the unpaid portion.

The change is not a rate cut or a severity trend. It is a cleaner way to build the tail benchmark. In the countrywide paid indemnity table immediately following the Exhibit 9 note, the 19-to-ultimate factors shown for accident years 2000 through 2004 range from 1.036 to 1.039. Put plainly, that tail adds about 3.6% to 3.9% to paid-to-date losses at that maturity. On $10 million of mature paid losses, a 0.003 difference in the selected tail is $30,000 before any layering, discounting, or allocation by state.

That is why the methodology change should be handled as a reconciliation, not a rewrite. A self-insured program should not retrofit every prior-year selection mechanically. It should ask whether the old paid benchmark in the reserve report came from a pre-2025 Annual Statistical Bulletin and whether the new direct paid tail would have moved the selected factor, especially for lost-time claims, permanent partial claims, and long-duration medical files.

The broader WC backdrop makes the check worth doing. NCCI’s 2026 State of the Line Guide reported a 91% calendar-year combined ratio for 2025, a 102% accident-year combined ratio, $14 billion of estimated reserve redundancy, a 2% decline in lost-time frequency, and 4% growth in both medical and indemnity severity. Those numbers do not set a self-insured employer’s reserves, but they narrow the margin for stale benchmark selection. The same benchmark discipline was the point in our pieces on NCCI’s trend dashboard and three-decimal loss costs.

What this means for your next review

Put three items on the next reserve-study agenda. First, identify whether the latest WC review used NCCI paid development benchmarks and which Annual Statistical Bulletin edition supplied them. Second, ask for a side-by-side of the selected paid tail against the 2025 direct paid age-to-ultimate factors, without forcing the new factor into history. Third, have the actuary explain whether paid and incurred methods diverge because payment timing changed, case reserves changed, or claim mix shifted.

ASOP No. 43 on property/casualty unpaid claim estimates requires methods and assumptions to fit the intended purpose of the estimate. ASOP No. 20 becomes relevant when the payment pattern feeds a cash-flow or discounting analysis. For finance leaders, that translates into one practical request: document the paid pattern source, the tail selection, and why the selected benchmark is still fit for your retained WC program.

Sources

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