Presented by Michael Regan
The Commissioner of Insurance recently approved a general revision of Massachusetts workers’ compensation rates that was effective April 1, 2014, applicable to new and renewal policies. There was no change to the overall rate level; however most individual class rates will change to reflect industry group differentials.
This may not necessarily be a bad thing for you! Depending on the classifications used for your workers compensation policy the rates may increase or decrease within a range for any particular industry.
Workers’ compensation rates were last raised in 2001 by one percent. Although Loss of Wage coverage has not changed, medical costs, as we all know too well, have been skyrocketing and workers compensation rates have not kept pace. Given the recent political climate, there has not been an appetite by regulators to approve any increases.
After many years of asking for relief and not getting any, the insurance industry took a harder stance on writing workers compensation policies in Massachusetts. Some existing accounts were receiving non-renewal notices and new business was scrutinized by underwriting with a fine tooth comb. The end result was a spike in business to the Massachusetts Workers Compensation Assigned Risk Plan.
Some may see the allowance for rate changes within industry ranges, as a fig leaf offering between regulators and carriers. To the public there is no overall change, but it allows the carriers to get some rate relief in specific industries and classes that have been troublesome and the changes may better predict workers compensation losses. Bear in mind that not all rates will increase. In fact many are decreasing. For example; the rate per $100 of payroll for Electrical Wiring (code 5190) was $2.84 and is now going down to $2.74.
If you would like to review the effect of these changes on your policy please click on the following link https://www.wcribma.org/mass where you can look up the rates as well as see what other changes may impact your business.
At Cleary, we will evaluate your business exposures and work with you to develop a comprehensive plan to safeguard your business. Give us a call today at 617-723-0700.