December 01, 2005

Insurance Commissioner Approves 15.3% Workers’ Compensation Rate Reduction Effective 1/1/06

San Francisco, CA November 10, 2005. On July 28, 2005, the WCIRB submitted to the California Insurance Commissioner a proposed 5.2% average decrease in advisory pure premium rates as well as changes to the California Workers' Compensation Uniform Statistical Reporting Plan - 1995 and the California Workers' Compensation Experience Rating Plan - 1995. On September 15, 2005, the WCIRB amended its filing to propose an average 15.9% decrease in pure premium rates based on insurer loss experience valued as of June 30, 2005 and a re-evaluation of the cost impact of the January 1, 2005 Permanent Disability Rating Schedule.
Earlier today, the insurance commissioner issued a decision with respect to the WCIRB's filing. In the decision, the insurance commissioner approved an average 15.3% Workers’ Compensation rate reduction effective January 1, 2006, applicable to new and renewal policies with anniversary rating dates on or after January 1, 2006.

Pure Premium Rates (claims only) – The WCIRB has now published the statistical estimated claims cost by class code for policies with effective dates 1/1/06 and later. To determine the average cost for your class codes, add 35% for insurance company overhead and claims handling expenses on top of these estimated claims costs. While each insurance company will determine their own rates, this will give you an idea of what the “average cost” across the state should approximate. Pure Premium Rates can be found at: wcirbonline.com, “WCIRB Wire.”

Please contact Orion Risk Management to discuss any further information regarding the Worker’s Compensation rate reduction. A qualified staff member will be able to assist you with any questions you may have.

You may also visit our website at orionrisk.com and register to use our NEW Workers’ Compensation Rating Tool which will give you an estimate of what your Workers’ Compensation premium will be.

IMPORTANT REMINDER: Employer's with more than 50 employees must provide Sexual Harassment training to all Management and Supervisory employees by January 1, 2006. Please contact Michaelee Stack for further information at (949) 608-4917.