The organization that files workers’ comp rates in Massachusetts has agreed to leave premiums flat through next year, following an agreement with the state’s attorney general that blocked a proposed increase of 6.6 percent.
The Workers’ Compensation Rating and Inspection Bureau of Massachusetts (WCRIBMA) submitted its rate filing yesterday, which will result in no change to workers’ comp premiums through at least Sept. 2012. WCIRBMA is the licensed rating organizations for workers’ comp insurers in the state, and files rates with the Division of Insurance.
Under the agreement — which still must be approved by state regulators — the rate freeze will last until Aug. 2012. The attorney general’s office will also be able to review loss costs and other data next year.
Insurers’ had sought an average increase of 6.6, percent, which Attorney General Martha Coakley’s office said translated to an additional $65 million in premiums.
“The industry’s request to raise rates could not have come at a worse time for small businesses in Massachusetts,” Coakley said. “We told the industry that we believed the rate was unjustified and that we would litigate to stop it. Blocking the rate increase helps ensure that businesses do not overpay for workers compensation insurance.”
WCRIBMA President Paul Meagher said that “with the economic recovery just beginning to gain traction, the workers’ compensation insurance industry is willing to assist Massachusetts employers by waiting another year before requesting a rate increase. However, the ongoing decline in claim frequency has been more than offset by increased claim severity, which is driven primarily by higher medical costs. If this trend continues, as forecasted, it will contribute to a need for higher workers’ compensation rates in the future.”
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