On Wednesday, California Insurance Commissioner Ricardo Lara issued a decision to once again reduce California workers’ compensation pure premium advisory rates effective September 1, 2021. Rejecting a proposed average rate increase of 2.7%, Commissioner Lara approved an average 3.4% reduction in advisory pure premium workers’ compensation rates across all classification codes. Advisory pure premium rates are set by the CA Department of Insurance, and they are used by insurance carriers as guidelines to develop their respective filed rates.*
Last year, the WCIRB proposed an average advisory pure premium rate increase of 2.6% to be effective 1/1/21, but the CA Insurance Commissioner ultimately approved a 4.6% reduction in the average advisory pure premium rate for workers’ compensation policies incepting 1/1/2021 and after. Through the 9/1/2021 rate approval, CA has now seen eleven consecutive reductions to the average advisory pure premium rate.
The relative change between the approved 1/1/2021 rates and the proposed 9/1/2021 rates for Sector 11 (“Agriculture, Forestry, Fish & Hunting”), which includes the majority of the CA workers’ compensation classification codes applicable to agriculture, are shown in the table below**:
|
Class Code |
Classification Phraseology |
1/1/2021 Approved Advisory Rate (per $100 of payroll) |
9/1/2021 Approved Advisory Rate (per $100 of payroll) |
Percentage change from 1/1/21 to 9/1/2021 |
|
0005 |
NURSERIES — propagation and cultivation of nursery stock |
4.74 |
4.28 |
-9.7% |
|
0016 |
ORCHARDS — citrus or deciduous fruits |
6.00 |
6.02 |
+0.3% |
|
0034 |
POULTRY RAISING, EGG PRODUCTION AND HATCHERIES; SHEEP, HOG OR CALF FARMS |
5.80 |
5.50 |
-5.2% |
|
0035 |
FLORISTS — cultivating or gardening |
5.14 |
4.49 |
-12.6% |
|
0036 |
DAIRY FARMS |
7.07 |
6.65 |
-5.9% |
|
0038 |
Stock Farms |
6.94 |
7.51 |
+8.2% |
|
0040 |
Vineyards |
3.38 |
3.23 |
-4.4% |
|
0041 |
Potato Crops |
5.03 |
4.35 |
-13.5% |
|
0044 |
Cotton Farms |
3.72 |
4.49 |
+20.7% |
|
0045 |
Orchards – Nut Crops |
3.78 |
3.79 |
+0.3% |
|
0050 |
Farm Machinery Operations – by contractors |
5.64 |
6.03 |
+6.9% |
|
0079 |
Bush Berry Crops; Strawberry Crops |
2.99 |
2.73 |
-8.7% |
|
0096 |
Nut Hulling/Shelling |
5.38 |
4.51 |
-16.2% |
|
0171 |
FIELD CROPS |
5.36 |
5.14 |
-4.1% |
|
0172 |
TRUCK FARMS |
3.82 |
3.57 |
-6.5% |
|
0401 |
Cotton Gin Operation |
6.55 |
6.45 |
-1.5% |
|
2702 |
Logging |
18.01 |
15.83 |
-12.1% |
|
2727 |
Log Hauling |
10.14 |
10.26 |
+1.2% |
|
7409 |
AIRCRAFT OPERATION — agricultural — dusting, spraying or seeding — members of the flying crew |
7.36 |
7.38 |
+.30% |
|
7410 |
AIRCRAFT OPERATION — agricultural — dusting, spraying or seeding — not members of the flying crew |
4.60 |
4.34 |
-5.7% |
|
8209 |
VEGETABLES — fresh vegetable or tomato packing and handling — including storage |
5.36 |
5.08 |
-5.2% |
*Source: WCIRB California, Advisory Pure Premium Rates https://www.wcirb.com/guide-to-workers-compensation/rates/pure-premium-rates
**Source: WCIRB California https://www.wcirb.com/content/september-1-2021-regulatory-and-pure-premium-rate-filings
Western Growers Insurance Services, which offers full-service risk management solutions to agricultural and related industry members, provides expert guidance on workers’ compensation and premium advisory rates. For assistance, contact Ken Cooper at [email protected] or 949.413.8751.