Continuing the downward spiral in rates, the California Workers Compensation Insurance Rating Bureau is recommending a 5.2 percent decrease in the pure premium rate for policies incepting and renewing Jan. 1, 2006. The forth decrease recommended by the Bureau, it represents the positive trend in loss adjustment development and the impact of the workers comp reforms of those developments.

The Bureau recommended a 13.8 percent decrease for July 1, but Insurance Commissioner John Garamendi bested that by adopting an advisory rate of 18 percent. Most carriers filed rates in between.

The Bureau plans to reevaluate its recommendation in September before the Department of Insurance convenes its rate hearing to consider more data from the new Permanent Disability Rating Schedule. Included in the re-evaluation will be at least one study that looks at the actual ratings that have been done so far under the PDRS to determine the cost of benefits.

The California Supreme Court has tossed out the challenges to the PDRS and organized labor and the California Applicants Attorneys respectfully. What remains is litigation before the Workers Comp Appeals Board that will either further or diminish the savings from SB 899 and earlier reform bills.

Cases on permanent disability and apportionment are making their way to the recon and appellate court levels and how those cases are decided will help decide how much longer carriers can continue to slash rates.

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