New Jersey’s Compensation Rating and Inspection Bureau announced that the commissioner of banking and insurance has approved a 2.9 percent increase in rates and rating values applicable to New Jersey workers’ compensation and employers liability insurance effective Jan. 1, 2015 on a new and renewal basis.
According to the Compensation Rating and Inspection Bureau’s circular letter issued on Nov. 13, the rating components of the increase are summarized as follows:
• Premium and Loss Experience: Analysis of data for the latest two complete policy years and the latest calendar-accident year, following adjustment to present premium and benefit levels, using paid and incurred losses separately, indicates a premium level adjustment factor of 0.975 (-2.5 percent) due to experience. A trend factor of 1.046 (+4.6 percent) is included to recognize changing exposures and losses.
• Benefit Changes: Effective Jan. 1, 2015, the maximum weekly benefit with respect to all types of injuries, except permanent partial disabilities, will be changed from $843 to $855. The minimum weekly benefit will be changed from $225 to $228. In cases involving permanent partial disabilities, the present maximum weekly benefits ranging from $225 to $843, varying on the basis of duration of disability, will be changed to $228 and $855, respectively. The minimum weekly benefit for permanent partial injuries will remain at $35. The effect of the changes to the minimum and maximum weekly benefits results in a premium level adjustment factor of 1.004 (+0.4 percent) due to benefits.
• Expenses: There is need for an increase in both the provisions for Loss Adjustment Expense and the Security Fund. The changes to the expense provisions result in a premium level adjustment factor of 1.005 (+0.5 percent).
• Overall Rate and Rating Value Change: The combined effect of the above adjustment factors results in an overall rate and rating value adjustment factor of 1.029 (+2.9 percent).
New Jersey law also mandates application of separate policyholder surcharges to finance the Second Injury and Uninsured Employers’ Funds. Based on the Department of Labor and Workforce Development’s estimate of 2014 Fund requirements, the policyholder surcharge percentages effective Jan. 1, 2015, on a new and renewal basis to be applied to the modified premium are: 6.07 percent for Second Injury Fund and 0.00 percent for the Uninsured Employers’ Fund.
Source: New Jersey Compensation Rating and Inspection Bureau
Was this article valuable?
Here are more articles you may enjoy.