Florida orders 5.1% workers comp rate decreasePosted On: Nov. 5, 2015 12:00 AM CST
Florida's Office of Insurance Regulation has ordered a 5.1% workers compensation rate cut, disapproving the National Council on Compensation Insurance Inc.'s proposed 1.9% overall rate level decrease.
Florida Insurance Commissioner Kevin M. McCarty ordered Boca Raton, Florida-based NCCI to submit a new rate filing that contains a 5.1% reduction in rates no later than Nov. 9 to meet statutory timeframes for a Jan. 1 effective date, according to a Tuesday statement by the Office of Insurance Regulation. In the statement, Commissioner McCarty said the use of a 4% profit and contingencies provision in the filing is “excessive” and “does not adequately reflect investment income or unearned premium and loss reserves.”
NCCI's original proposal included a 1.9% overall average rate cut, a reduction in the expense constant from $200 to $160, and changes to minimum premiums.
Commissioner McCarty disapproved the $160 expense constant, which represents the common administrative expenses of issuing and administering a workers comp policy, the statement says. He ordered the ratings and research organization to re-file with an expense constant of $200, a production expense provision no greater than 17.9%, and a general expense provision no greater than 5.2%.
“No rate change shall be implemented until such amendments are properly filed and final approval is issued by the office,” Commissioner McCarty said in the statement.