The Department of Industrial Relations just announced its annual assessments for 2024. The total assessments are $1.7 billion – an 8.5% increase from the $1.57 billion for 2023. It is effectively a tax on employers.
Insured employers will pay just over 6% of premium added on to 2024 workers’ comp premium.
Self-insured employers are assessed based on the total amount of workers’ comp indemnity they pay. Next year, the assessment rate will be 11.1% of their total indemnity compared to the 11.8% they are currently paying.
Insured employers are again spared what used to be an annual 2% assessment to fund the California Insurance Guarantee Association (CIGA), which has enough money to fund its workers’ comp liabilities.
The overall amount DIR needs to collect is offset by leftover money in the various buckets for workers’ comp administration, Cal/OSHA, the California Labor Commissioner, the subsequent injuries fund, the uninsured employers’ fund, and the anti-fraud fund. While the total assessment amount is up 8.5%, the rate insured employers will pay is up 3.3%, while self-insured employers will see a 5.9% decrease in their assessment factors.
The assessments are divided between insured and self-insured employers based on their relative share of the statewide payroll. For next year, the split is 73.76% for insured employers and 26.24% for self-insureds. Note the decrease in the self-insured assessment percentage.
Workers’ Comp Executive will have additional details and analysis of the assessments in its next premium edition.
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