New York State Plan to Increase Higher Workers Compensation Rates

As a business owner in New York State, it constantly amazes me how the state can come out with rate increases of this magnitude. They keep saying the rate increases are warranted and required but provide no real reason why. When they say, “Average rate increase” this actually means, in some cases, the rate increase could be 15% to 20%.

The New York Compensation Insurance Rating Board (NYCIRB) has submitted to the Department of Financial Services on Thursday May 17^th a loss-cost filing for an overall average loss cost change of +11.5%.

This change represents the upcoming cost of losses and loss adjustment expenses to be effected on policies on or after October 1^st, 2012. According to the NYCIRB, the proposed change is the result of continued adverse experience of the New York Workers’ compensation carriers. This is attributable to the following factors:

• Sections of the 2007 reform, which were expected to result in significant savings, have been implemented at a slower pace even though the reform has been fully implemented with respect to the increase in maximum weekly benefits.
• There is no longer a significant downward trend exhibiting claim frequency, which, in the past, served as an offset to increasing claim costs.
• Continued rise in both indemnity and medical claim costs.
• Increasing loss adjustment expense primarily due to additional resources necessary for compliance with recent legislative and regulatory changes.

Based on the information given by the Workers’ Compensation Board (WCB) and the current loss cost proposal, the New York State Assessment is estimated to decrease 2.7% resulting in an average net increase in cost to policyholders of 8.5%. It is required that the New York Department of Financial Services will be holding a public hearing on the loss-cost filing whenever the filed amount exceeds 7.0%.

After www.InsuranceJournal.com, you should consider doing the following :

1. Are you properly classified?
2. Are your modification worksheets up to date?
3. Are you rated in the correct territory?
4. Are you eligible for payroll limitation?
5. Are you with the best carrier for your particular business?

Workers[JF1]  compensation, like all the other lines of insurance, has to be managed and controlled. So ask yourself, is your company doing this?

Don’t sit back and let the state dictate your cost coverage. Do things now that will enable you to have the best coverage at the best price and remember, not all companies offer the same rates.