Experts warn about changes to workers' comp experience ratings

NORTH BAY, CALIFORNIA – The impact of new changes to workers' compensation experience modification factors that went into effect in January are only now being realized and have the potential to significantly increase employers’ premiums on claims, insurers said last week.

The Workers’ Compensation Insurance Rating Bureau recently submitted proposed changes to Insurance Commissioner Steve Poizner to alter the experience rating formula.

Large employers are finding that their premiums are rising, and the potential to incur fees from the Occupational Safety and Health Administration have increased as the new rating pushes their workers' compensation claim rate up, particularly if it is above 125. The  average rating is 100.

Brian Murphy, vice president of Heffernan Insurance Brokers’ North Bay branch, said the increases could reach 10 percent or more for employers.

“What it ended up doing is increasing modules and costs,” Mr. Murphy said, calling the changes “pretty significant.”

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