News: 2009 Press Release
For Release: December 9, 2009
Media Calls Only: 916-492-3566
Insurance Commissioner Poizner Announces Analysis Reveals Relatively-Stable Workers' Comp Rates for 2010
Just a month after rejecting an insurance industry request to increase the Workers' Compensation Claims Cost Benchmark by nearly 25 percent, Insurance Commissioner Steve Poizner announced today that workers' compensation insurance rates will be relatively stable and increase by an average of only 4 percent in 2010.
"This is great news for the small business owners across our state and proves that the double-digit increase I rejected was flat-out unwarranted," said Commissioner Poizner. "It's unfair for the insurance industry's inefficiency to lead to higher rates for employers who are struggling during the recession. This latest data reinforces my view that when forced, insurance companies have found a way to use tools already available to them to reduce costs and minimize rate changes."
Last month, Commissioner Poizner rejected a request for a 22.8 percent increase in the Workers' Compensation Claims Cost Benchmark. It was the second consecutive request for a 20 percent or more increase in the benchmark that Commissioner Poizner rejected.
The Department of Insurance recently analyzed the rate changes requested by the top100 workers' compensation insurance companies. These companies represent 97.1 percent of the workers' compensation insurance market.
The analysis found that 59 companies have made new rate filings for next year. Companies who want to keep the same rates do not need to file for new rates. Of those 59 companies, four companies filed for rate decreases ranging between 8.4 percent and 1 percent, 13 companies filed for no overall rate change and the other 42 companies have filed for rate increases between 0.6 percent and 12 percent. The straight average rate increase for all 59 companies is 4.1 percent, and when weighted for market share, the premium weighted average rate increase is 4.0 percent. This last calculation does not include State Fund.
Please visit the Department of Insurance Web site at www.insurance.ca.gov. Non media inquiries should be directed to the Consumer Hotline at 800.927.HELP. Callers from out of state, please dial 213.897.8921. Telecommunications Devices for the Deaf (TDD), please dial 800.482.4833.
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