03/28/2024

California’s workers’ compensation costs dropping

The good news, at least for California employers, is that the 2012 overhaul of the state’s system of compensating workers for job-related illnesses and injuries appears to be having its stated effect.

Although the changes – a deal between employers and unions that drew Gov. Jerry Brown’s blessing – increased cash benefits to disabled workers, it also cracked down on medical costs.

By 2015, the Workers’ Compensation Insurance Rating Bureau says in a new report, employers’ average insurance premiums, which had topped $6 per $100 of payroll in 2003, had dropped to $2.86.

Simultaneously, the WCIRB has submitted to Insurance Commissioner Dave Jones a recommendation for a “pure premium rate” averaging $2.30 per $100 of payroll effective July 1, 10.4 percent lower than the average pure premium rate being charged by insurers as of Jan. 1.

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