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California Workers’ Comp Highly Profitable

California’s workers’ comp insurance industry remained highly profitable in 2019, returning a pre-tax underwriting profit of 18% for the second straight year. The profitability percentage is also pre-investment income putting the profits into the 20% of premium range. However, expectations for 2020 are unclear as officials predict a 20% decline in written premium for the … Read More »

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Self Insurance Rules Final

The Department of Industrial Relations’ Office of Self-Insurance Plans finally wrapped up rulemaking on one of the last pieces of the Baker SB 863 workers’ comp reforms. The Office of Administrative Law approved the agency’s revised submission for new reporting rules and forms for public agencies that self-insure for workers’ compensation. The regulations took effect … Read More »

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Large Deductible Policies Have Worse Results

Insurance carriers writing large deductible workers’ comp policies in California – policies where employers retain at least $100,000 of the liabilities but often times it is in the millions – spend dollars significantly faster on indemnity claims compared to non-deductible policies. This significantly affects employers with deductibles. The question is why and does it relate … Read More »

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Court Decision Limits CIGA’s Losses

The California Insurance Guarantee Association projects that it will be nearly $160 million in the red on the deposit from the failed Lumbermens Mutual Casualty Company. But there is also some good news: An Illinois court is keeping the hole from getting even deeper despite the best efforts of the Illinois Department of Insurance to … Read More »

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High ALAE Costs In Large Deductible Plans

High attorney involvement, elaborate regulatory schemes, medical care conducted on a lien basis, and scores of cumulative trauma claims filed on a post-termination basis are just a few of the unique factors that make California’s workers’ comp system the most expensive in the nation. California’s loss adjustment expense (LAE) ratio is nearly double the national … Read More »

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Savings From SB 863 More Than Previously Thought

The initial projected $200 million in net savings per year from the SB 863 workers’ comp reforms is turning out to be a $1.3 billion per year windfall for the workers’ comp system, and more savings could still materialize. So too could additional costs. The latest industry report on the system’s post-reform costs shows that … Read More »

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WORKERS’ COMP RATES CUT FOR JULY

California Insurance Commissioner Dave Jones adopted the industry’s recommendation for a 5% cut in the state’s workers’ comp advisory pure premium rates for policies incepting or renewing on or after July 1, 2016. The mid-year cut is being driven mostly by continued improvement in medical loss costs. However, the public members of the Bureau’s Governing … Read More »

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California Workers’ Comp Premiums Up At Mid-Year Mark

Workers’ comp carriers in California are on pace to write nearly $18 billion in workers’ compensation premiums for 2015. The projection is from the Workers’ Compensation Insurance Rating Bureau at the half-way point. The total premium before deductible credits is up approximately 9% over the 2014 total at the same point last year. The study does … Read More »

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