The Workers' Compensation Insurance Rating Bureau of California (WCIRB) issued its recommended Pure Premium Rates today for January 1, 2012.
Although there had been much debate and concern regarding this announcement amid numerous rumors and speculation that insurance rates would be increasing again to keep up with alleged continuous increases in costs incurred due to Workers' Compensation claims; the WCIRB actually reduced their recommended Pure Premium Rates by 1.8%. This IS good news for California employers, especially since most of them have been repeatedly told that rates are due to rise again and keep rising into the foreseable future.
IMPACT ON EMPLOYERS
Employers should anticipate to start seeing a leveling off of their insurance rates into next year, but they will most likely NOT see a sudden decrease in rates. It is important to keep in mind that the WCIRB merely recommends rate increases and decreases as they monitor the Workers' Compensation market place and that each individual insurance company must develop their own rates and rating guidelines and submit them to the California Department of Insurance (CA DOI) for approval prior to offering the rates to customers.
There has been a considerable amount of uncertainty in the workers' compensation market over the past few months which has been largely overshadowed by the uncertainty in the Health Insurance market; but the uncertainty has caused many carriers to recently file for rate increases. Many rate increases that we have witnessed have been in the 9-15% range and none of them as of yet have been decreases worth mentioning.
SUGGESTION FOR EMPLOYERS
GDI Insurance anticipates that its clients and California employers in general will witness a plateau effect in the unmodified workers' compensation rates and a noticeable reduction in insurance carrier willingness to aggressively credit accounts based solely on subjective attributes as they have been for the past few years.
It has been GDI's consistent position that employers should do everything within their power and budget to ensure that their employees are happy, health, and above all, SAFE. By ensuring the safety and wellbeing of their employees in ways that are empirically trackable, employers may be able to mitigate the potential impact of many workers' compensation rating fluctuations and constrictions.
Click this link to see the Rate Filing Cover Letter
For more information regarding what is considered Objective and Subjective when it comes to how an insurance carrier may view your business, please Ask The Experts at GDI Insurance in Turlock, CA by calling 888-991-2929.
Matthew Davis MBA, AAI