State Compensation Insurance Fund has filed an average collectible rate decrease of 14 percent on new and renewal workers’ compensation policies with an effective date on or after July 1, 2005. The filing includes a mid-term 3.8 percent rate decrease effective July 1, 2005 on the unexpired portion of all policies with a January through June 2005 anniversary rating date. With this filing, State Fund has reduced collectible rates a cumulative 26.2 percent since December 2003.
Included in the above decrease is a new 10 percent workplace safety credit that rewards small employers (premium between $1,000 and $75,000 annually) with superior safety records. The new credit recognizes the important contribution these safety conscious employers make to the quality of life of their employees and to keeping the cost of insurance down for all employers. Some State Fund policyholders qualifying for the new credit will see decreases in their premium greater than 20 percent.
Due to changes in the class experience for an industry, changes in experience modifications due to individual policyholder experience, and other changes in rating plan features, individual policyholders could see more or less than the 14 percent average decrease.
“State Fund is committed to ensuring policyholders receive the benefits of reform legislation which has lowered premiums and increased competition,” said State Fund acting President James C. Tudor.
“The reform legislation signed by Governor Schwarzenegger has already generated significant savings and brought much-needed rate relief for California employers,” said Jeanne Cain, Chair of State Fund’s Board of Directors. “I have every confidence that these reforms will continue to lower costs for California employers.”
Tudor added, “We are also observing a significant return of private insurance capacity to the California market. Insurers who have remained in the market are writing more business; and new carriers are coming to California; or, in some cases, are being formed in California. I expect this trend to continue; a healthy, competitive marketplace benefits all of the system’s stakeholders, as well as the California economy.”
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