The commissioner also said in the same statement that a decision by the Workers’ Compensation Insurance Rating Bureau to only file for mid-year pure premium rate changes in extraordinary circumstances will further stabilize the state’s workers’ compensation market.
The Rating Bureau’s summary of insurer experience through Sept. 30, 2011, said calendar year loss ratio for the first nine months of 2011 was 66%, down from 75% for the same period in 2010. The summary, released on Dec. 9, also said the calendar year combined ratio for 2010 is 116%, the same as 2009.
The Rating Bureau report projects ultimate accident year losses for 2010 of $8.1 billion, 4% higher than the $7.8 billion for 2009.
“This report on insurer loss experience shows that insurer losses are similar to what insurers experienced a year ago and there currently is stability in the workers’ compensation market,” Jones said in a statement.
Jones also said the Rating Bureau will no longer file for mid-year rate changes without extraordinary circumstances. The bureau’s governing committee had an informal policy of only recommending mid-year adjustments that were at least 5% different from its annual Jan. 1 recommendation.
“The WCIRB’s decision to refrain from filing mid-year pure premium rate changes, absent extraordinary circumstances, such as highly unusual volatility in the experience of insurers or major legislative, regulatory, or judicial action, follows a recommendation from the Department of Insurance following an operational examination of the WCIRB,” Jones said. “This will assure employers that there will be fewer changes in workers’ compensation insurance pricing unless there are substantial changes to the workers’ compensation system.”
In November, Jones praised a decision by the State Compensation Insurance Fund to hold premiums “essentially unchanged” for 2011 as another move that will bring stability to California’s workers’ compensation market.
Source: Calif. Insurance Department