AIA Says Workers’ Comp Rate Reduction Recommendation Demonstrates Reforms are Working

The following statement is in response to the Workers’ Compensation Insurance Rating Bureau Governing Board’s decision to recommend that Insurance Commissioner John Garamendi (D) decrease workers’ compensation rates 15.9 percent for policies renewing in January 2006. This recommendation will be discussed today during a hearing at the California Department of Insurance in San Francisco. This statement can be attributed to Ken Gibson, AIA vice president, Western Region:

“Workers’ compensation rates are continuing to tumble downward as abusive practices are stopped and unnecessary costs are eradicated from the system This is the fifth consecutive decrease that has been recommended since the reforms were enacted last year. It is unfortunate that the California Assembly chose not to approve SB 292 authored by Sen. Jackie Speier (D).

“SB 292 would have closed a loophole that is allowing doctors to repackage drugs and sell them to patients for an exorbitant profit. The reforms enacted last year, which are making these major rate decreases a reality, stopped abusive practices just like this. The governor and legislature must protect the reforms because they are transforming California’s workers’ compensation system from the worst in the country to a system that is now benefiting our entire economy. Both public and private employers can use the savings they realize through lower workers’ compensation costs to invest in their businesses and their employees.”

Topics California Workers' Compensation Pricing Trends