California looking at 10.2% reduction in workers comp rates

The California Workers’ Compensation Insurance Rating Bureau is set to request a 10.2% mid-year reduction in advisory workers compensation rates based on lower-than-expected medical losses and claim severity in the state.

WCIRB’s expected rate filing will seek an advisory pure premium rate of $2.46 per $100 of payroll as of July 1, down from $2.74 per $100 of payroll approved by the California Department of Insurance as of Jan. 1, Oakland, California-based WCIRB said in a statement Wednesday. The bureau plans to submit its new rate filing to the insurance department for approval on Monday.

Medical severity for California workers comp claims declined more than 4% per year in 2013 and 2014 following the passage of state workers comp reforms in 2012, WCIRB said Wednesday.

Meanwhile, indemnity claim severity increased 5.4% last year, less than the 9.6% increase in indemnity severity that WCIRB originally had projected for that year, according to actuarial data posted online by the bureau.