The Workers’ Compensation Insurance Rating Bureau of California’s (WCIRB) Governing Committee gave the go-ahead March 20 for a filing of a 10.1 increase in advisory pure premium rates to be effective on policies commencing on or after July 1, 2002.
The recommened increase was predicated on the study of newly available fourth quarter 2001 data, which revealed much larger than expected loss development. None of the proposed increase is related to enactment of Assembly Bill 749. The impact of that bill will be taken into account in the WCIRB’s Jan. 1, 2003 filing scheduled for this summer.
According to Dave Bellusci, chief actuary for the Bureau, decline in loss development for the 2000 and previous accident years has been especially severe over the last year. He added that in only a few months time, subsequent to their approval, the 2002 pure premium rates have already been 10 percentage points inadequate. He noted that the most recent available data suggests that there is no evidence that the loss development trend will show moderation in the short term.
The WCIRB is expecting to submit a rate filing with the California Department of Insurance by the end of March, with an expected public hearing to take place through Commissioner Harry Low in May.
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