The Workers’ Compensation Insurance Rating Bureau of California (WCIRB) has submitted a filing with the California Department of Insurance (CDI) proposing changes to the approved pure premium rates that became effective Jan. 1, 2002.
WCIRB’s filing recommends that pure premium rates be increased by 10.1 percent effective July 1, 2002 for new and renewal policies with anniversary rating dates on or after July 1, 2002.
The current pure premium rates were structured using insurer experience from the 2000 and prior accident years, evaluated as of June 30, 2001. In his letter accompanying the filing, WCIRB President Robert Mike indicated that “the WCIRB is concerned that in the six months since that experience was reviewed, loss development has continued to deteriorate to the extent that the approved January 1, 2002 pure premium rates are already more than 10 percent inadequate.” Mike also noted that the WCIRB is not foreseeing any signs that this deterioration in loss development will not continue into the near future.
The proposed 10.1 percent increase does not reflect the cost impact of Assembly Bill 749, which was recently enacted. The impact of Assembly Bill 749 on pure premium rates will be reflected in the WCIRB’s Jan. 1, 2003 filing scheduled to be made this summer.
The CDI will hold a public hearing regarding this filing at 10 a.m., on May 14, 2002 in the 22nd Floor Hearing Room, 45 Fremont Street, in San Francisco.
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