A few months ago, the workers’ compensation Insurance Rating Bureau (WCIRB) announced it was recommending a “pure” rate increase of 4 percent for workers’ compensation rates. “Pure” premium rates are the rates based on the actual losses and expenses paid on workers’ compensation injuries, but do not include a company’s administrative costs. As a result, effective rate increases can be 5-10% higher than the pure amount.
Although the WCIRB will not announce its revised rate increase figures until October, preliminary information indicates it will recommend anywhere from a 7-11 percent increase. This will have a trickle-down effect on the rates charged by insurance carriers. With a pure rate increase recommendation of around 10 percent, it’s likely that most companies will increase their rates by 15 percent or more. These rate increases will be effective January 1, 2014, so business owners need to prepare for these changes in the next few months in order to deal with them appropriately.
Although business owners can’t avoid paying higher rates for workers’ compensation coverage, there are a number of actions you can take to reduce the number and cost of the injuries that do occur, including:
- Providing focused safety training for managers and employees
- Conducting a detailed review of claims to control future costs and minimize future accidents
- Working with a high-quality workers’ compensation insurance company. It’s expertise in dealing with workers’ comp issues can have a significant positive impact on the costs of insurance coverage
Western Growers Insurance Services works closely with clients to ensure they have the most affordable workers’ compensation program possible. If interested in a review of your workers’ compensation program, please contact your local WGIS sales representative or Greg Nelson, AVP of Commercial Lines.
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