The workers compensation market remains healthy across Missouri and surrounding states, but 2026 brings nuanced changes. While loss frequency continues declining industry-wide, cost pressures are emerging that will impact premiums for policyholders. MEM President and CEO Roger Walleck breaks down the market conditions, rate changes, and unique factors affecting work comp costs this year.
The market remains strong, but changes are ahead
The work comp market across MEM’s footprint continues to thrive. Consider these data points for the state of Missouri:
- Over 100 insurance groups representing 300 individual carriers write coverage in Missouri.
- The market exceeds $1 billion in premium.
- MEM holds 21% market share.
- The work comp industry has posted combined ratios below 90% for ten consecutive years.
These are exceptionally healthy margins. Carriers spend roughly $0.90 on losses and expenses for every dollar of premium collected, reflecting strong industry stability.
Two key cost drivers to understand
Despite a strong market, the region is seeing some rate adjustments. Missouri faces a 1.3% loss cost increase for 2026, while some surrounding states are seeing rate decreases.
What’s driving costs up despite strong profitability? There are two primary factors:
- Increased utilization of services: Injured workers are requiring more medical visits and treatments per claim.
- Rising physician costs: Medical service expenses are climbing in some states, adding pressure to claim costs.
“We’re starting to see some of the components of costs going up,” Walleck explained. “Before, when an injured worker would go to physical therapy, maybe they would go for five sessions. Well, now we’re seeing those injuries result in eight or nine sessions.”
Loss frequency at historic lows
When MEM was chartered by the Missouri Legislature in 1993, nonfatal claims had reached crisis levels. More than 8% of workers in the state experienced work-related injuries annually. Today, that figure sits around 2%.
This dramatic improvement reflects an industry-wide commitment to workplace safety. Fewer injuries mean fewer claims, which benefits everyone – employers see lower costs; employees stay healthy and safe, and carriers maintain profitability.
“Our mission has always been about getting that employee home safe at the end of the day,” Walleck remarked.
☑️ The bottom line: Today’s loss performance reinforces what we’ve known for decades: That a strong dedication to workplace safety gets results.
Economic factors to watch
Three trends are shaping the 2026 landscape:
- Payroll growth has slowed. From 8-9% post-pandemic to approximately 4% year-over-year. Since work comp premium is based on payroll, this slowdown puts downward pressure on total premium volume.
- Job growth has stagnated. Early 2024 numbers were revised to show a net decrease over the summer months.
- Effects of recession on claims. During economic downturns, claim frequency often drops temporarily because less experienced workers – those most likely to be injured – are typically the first to be let go. The remaining, more experienced workforce is more familiar with their jobs and safety protocols.
However, this isn’t a long-term cost control solution. The real, sustainable answer to rising costs lies in incident prevention and proactive claims management.
Remote work’s impact on safety
A new cost driver has emerged: injuries among remote employees. “The increase in frequency for remote workers is a real thing,” Walleck emphasized. “Ergonomics is part of it.”
Why home offices create new risks
Home office setups rarely meet the ergonomic standards of traditional workplaces. Employees working from kitchen tables, couches, or makeshift desk spaces develop musculoskeletal injuries that turn into claims.
This creates an important consideration for businesses with hybrid or remote workforces. Employers remain responsible for workplace safety even when “work” happens at home.
💡 Pro tip: It’s up to businesses to assess remote setups and provide ergonomic guidance. Simple interventions, such as proper chair height, monitor position, and keyboard placement, can prevent costly injuries. MEM’s safety consultants can help evaluate these risks and suggest solutions.
📍 Read next: The New Smoking: How to Counter the Serious Risks of Too Much Sitting >
3 ways to control work comp costs
Cost control happens on three levels: injury prevention, claims management, and return to work. MEM offers specialized in-house expertise in all three areas.
- Proactive injury prevention. MEM’s Safety and Risk Services teams provide on-site consultations to help businesses identify and address hazards before injuries occur.
- Intentional claims management. In-house nurse case managers contact injured workers promptly to ensure timely and appropriate care. Our pharmacy programs reduce prescription costs.
- Return to work programs. Research consistently shows that getting injured workers back to work – even in modified duty roles – slows the escalation of claim costs over time. These programs benefit both employers and injured workers.
📍 Read next: 4 Proven Ways to Reduce Your Work Comp Costs >
Bottom line: The region remains competitive
Despite some rate adjustments, the Midwest maintains some of the most competitive work comp rates in the nation. This makes the region attractive for business and provides strong value for policyholders.
“The market continues to be a very healthy market,” Walleck summarized. “It makes Missouri and our surrounding states a very good area to do business, because our insurance rates are some of the best in the nation.”
The presence of more than 100 carrier groups in the region ensures competitive options to meet diverse business needs, while market stability means carriers remain committed long term.
Understanding these dynamics helps businesses navigate premium changes with context and solutions.
For expert guidance on injury prevention, claims management, return to work programs and more, visit our free resource library.