How States Rank, High to Low, in Workers’ Compensation Premiums

By Don Jergler | October 9, 2014

A list of state rankings for workers’ compensation premiums shows a slight drop in premiums in the last two years, and that a number of states are close in terms of how much employers are paying.

The list put out by the Oregon Department of Consumer and Business Services once every two years shows the 2014 median value of workers’ comp premiums paid was $1.85 per $100 of payroll, a drop of 2 percent from the $1.88 median in the 2012 study.

National premium rates range from a low of 88 cents in North Dakota to a high of $3.48 in California, the report shows.

The list also shows 21 states within 10 percent of the median and the range from highest and lowest rankings has been shrinking, according to Jay Dotter, who put the report together.

The effect is that it makes the list more “volatile,” Dotter said, adding that it’s important to note that volatility because some states use the list to measure the performance of their workers’ comp system.

“A small change in the index rate can give you a larger change in ranking,” he said.

 

2014 Oregon WC Premium RankingAs an example of a state that relied on the list to make changes Dotter pointed to Hawaii’s workers’ comp administrators, who noted their top 15 ranking in the 2006 report and put notice of the poor performance on a state’s website and publicized it to help champion reforms that were eventually passed.

The state was ranked 27th on the latest report.

Oregon’s workers’ comp system was in sad shape when the state began to compile the list in the 1980s in order to evaluate itself and push for reforms that were eventually passed. The state went from 6th place on the list and was 43rd on this year’s list, its best performance to date, according to Dotter.

The study puts states’ workers’ comp rates on a comparable basis using a constant set of risk classifications for each state. This study used classification codes from the National Council on Compensation Insurance.

Following California’s $3.48 per $100 in payroll was Connecticut ($2.87) at No. 2 on the list, coming in it at 155 percent above the national median workers’ comp premium. New Jersey ($2.82), New York ($2.75), and Alaska $2.68) rounded out the top five.

North Dakota (88 cents) was at the bottom of the list, which makes is the cheapest state for employers. It has traditionally ranked lowest, and the state retained it’s ranking from the 2012 list and also saw a drop in premiums from $1.01.

Other states where workers’ comp is far below the national median for workers’ comp premiums are Indiana (at 50 percent of the national median), Virginia (61 percent), Arkansas (64 percent) and Massachusetts (68 percent).

Workers Comp Premium Ranking Table

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Latest Comments

  • December 29, 2015 at 9:18 am
    John says:
    Interesting rankings method. However, it does not even start to tell the story. The industrial classifications are generic and do not reflect primary industry costs. Industry ... read more
  • September 13, 2015 at 7:40 pm
    Nick Van Boom says:
    Following up about my last comment about Oklahoma workers compensation laws. Thank god my parents were alive to help me!!! I would have been living in the street If they wer... read more
  • February 18, 2015 at 2:50 pm
    Nick Van Boom says:
    The workers compensation laws in Oklahoma stink. I got hurt on the job. The attorney said I would be protected. Yea, I had to move out of the state. Workers in this state d... read more
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