If you read my last post you may be pouring over the WCIRB’s “rate filing” documents.
But you can take the green eyeshades off for a moment.
The conventional wisdom is that workers comp costs will remain flat. That’s
the assessment of the Sacramento Bee’s business writer Dale Kasler, who notes in a piece in The Bee that “Workers’ compensation premiums will probably stay about the same in California next year”.
Kasler observes that:
“The filing was unusual because the bureau normally seeks double-digit increases. Bureau spokesman Jack Hannan said claims costs are rising but current premiums are “pretty close” to where they should be.
Typically, the bureau seeks a hefty increase and the insurance commissioner rejects it. Ultimately, insurers are free to price premiums as they see fit.
Workers’ comp was an enormous issue several years ago, when California’s costs were among the nation’s highest. Former Gov. Arnold Schwarzenegger signed into law a major overhaul of the system, and premiums fell dramatically. Even though prices have crept up the past four years, they’re still 60 percent cheaper than they were at their peak in 2003″.
If California workers’ comp costs are stable, the Governor and Insurance Commissioner Jones will be happy.
The nightmare political scenario would be rapidly increasing workers’ comp costs in a recessionary economy, with pressures to make “all cuts” in a system which has in many ways already cut injured workers to the bone.
So if insurance costs aren’t rising appreciably, it gives room to stakeholders to make some positive changes which will cut some fat from the system, give some players a haircut, and spread some of the savings to workers.
Category: Understanding the CA WC system