The WCIRB Governing Committee at its semi annual meeting today recommended the pure premium rate be reduced by 11.3%.

For the eighth time since January 1, 2004, the Governing Committee recommended a reduction in pure premium rate. With this reduction the cumulative decrease in the last three and one half years now totals 64%.

WCIRB actuary David Bellisci made the recommendation based on a multi faceted analysis which included consideration of the data submitted by insurance companies representing 88% of the statewide market with an annual premium of $15 billion. [AIG with a 10% market share and Virginia Surety with 1.5% of the market were not considered due to anomalies in the data submitted to the WCIRB.]

The recommended change in the pure premium rate involved an adjustment to historical data for indemnity loss and medical loss development projections and an analysis of the impact of legislation reforms including the implementation of the new Permanent Disability Rating Schedule effective January 1, 2005. Mr. Bellisci pointed out that the new rating schedule has had a major impact on indemnity payout and that the actual post reforms loss development has been better than expected. [The WCIRB Actuarial Committee estimated a 50% reduction in permanent disability benefits following the implementation of the new rating schedule] He opined that the Pendergrass  en banc decision issued in January will have a limited impact on the pre January 1, 2005 claims.