Two states on Monday announced reductions in workers compensation rates — Kansas by 6.4%, a fifth consecutive year of reductions, and North Carolina by 17.2% — highlighting a trend for businesses nationwide, experts say.

Officials in several states are approving rates cuts as employers report fewer and less severe claims and the trend will likely continue into next year, experts say.

“Most states have experienced an ongoing decline in claims frequency while indemnity, severity and medical severity have been relatively stable,” Trey Gillespie, Austin, Texas-based assistant vice president of workers compensation with the Property Casualty Insurers Association of America, said in an email.

“The big theme is workplaces continue to be safer,” said Jeff Eddinger, Boca Raton, Florida-based senior division executive for the National Council on Compensation Insurance, which provided to Business Insurance proposals for 2019 that show individual state decreases falling between 3.5% and 19.1%.

Many of the latest 2019 filings follow midyear reductions for 2018, announced over the past several months, and an NCCI report released Sept. 25 detailed a five-year cumulative decrease of 19% in comp claim frequency. 

“There are two major components that underline this: (lower) claims frequency and claims severity,” Mr. Eddinger said, echoing the sentiments of most state officials lauding the decreases that ultimately mean businesses pay less to insure workers.

For example, Idaho Department of Insurance Director Dean Cameron said in a statement on Oct. 2 that a 4.2% reduction for 2019 rates “reflects an improvement in our state rating factors, including a slight decline in both the frequency of claims for lost work time, and the average cost of those claims.”

West Virginia Gov. Jim Justice issued a statement on Sept. 13 announcing a 13% reduction there, thanking businesses for being proactive: “I believe safety measures instituted by a number of our employers in the state with assistance from carriers has helped us get these results.”

Mr. Gillespie of PCI also gave credit to businesses: “Employers are working effectively with insurers in order to make the workplace safer, and we believe loss costs have declined as a result,” he said in the email.

At least one state highlighted another factor at hand: workers compensation reform.

North Carolina’s Industrial Commission, in a statement released Monday, said 2014 and 2015 reform measures were partly responsible for the state’s 17.2% decrease. Among the reforms were adjustments to state fee schedules that included “approximately” 5% less in payments for nonhospital providers, a 24% reduction in outpatient treatment costs, and an 11% reduction for inpatient treatment, according to the statement.

Meanwhile, NCCI expects the trend to continue, according to Mr. Eddinger, as the overall drop in claim frequency in 2017 and 2018 stood at 6% — up from a long-term average of 4%.

“When claims are dropping by 6% each year, then you are definitely going to seeing decreases in the overall rates,” he said.

As for the reduction in more expensive claims, “it does seem like claim severity has moderated in recent years,” he said. “I don’t have any reason to expect that that will change anytime soon.”