A workers’ compensation rate increase may be in store for Washington for 2012. A final decision is expecetd in December.
The state’s Department of Labor & Industries (L&I) has asked the Workers’ Compensation Advisory Committee for input on restoring the workers’ compensation reserve funds, which have been drawn down during the recession. L&I is seeking the committee’s comments on a rate increase for 2012 ranging from 4.5 to 8 percent.
Workers’ compensation reforms passed by the Legislature earlier this year will save $1.1 billion over the next four years, and the resulting savings place the indicated or break-even rate for 2012 for workers’ comp premiums at a negative 0.3 percent, according to L&I. Without the reforms, the break-even rate for 2012 would have been an 8.1 percent increase, the L&I states.
L&I drew down its contingency reserves by $332 million over the last three years to hold down rate increases for employers and workers during the recession.
L&I actuaries told the WCAC that Washington’s current reserves are low by industry standards. For every dollar held in reserves by other public industrial insurers, Washington has 20 cents in reserve.
Topics Trends Workers' Compensation Pricing Trends Washington
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