COMMISSIONER APPROVES ONGOING WORK COMP RATE REDUCTIONS FOR FLORIDA EMPLOYERS
Tamela I. Perdue
On October 31, 2007, Insurance Commissioner, Kevin McCarty, approved a workers’ compensation
rate decrease of 18.4% for Florida employers, effective January 1, 2008.
Because of this latest rate reduction, Florida’s employers will realize,
on average a cumulative 51.4% rate reduction in workers’ compensation premiums
since the passage of the 2003 workers’ compensation reforms. Commissioner
McCarty issued a press release with the order praising the improvements that
Florida’s workers’ compensation system has experienced since
the 2003 reforms. The 18.4 percent decrease is the largest one-year decrease
in
workers' compensation rates on record for Florida.
With this rate approval, Florida’s major industries will see rate reductions
as follows:
1/1/08 Filing Cumulative 10/1/03–1/1/08
Manufacturing -17.5% - 47.6%
Contracting -17.9% - 52.0%
Office and Clerical -21.3% - 50.8%
Goods and Services -19.0% - 51.5%
Miscellaneous -15.2% - 53.0%
TOTAL -18.4% - 51.4%
Prior to the entry of the Order, there was a rate hearing October 8, in which
the National Council on Compensation Insurance (NCCI) sought approval of 16.3%
decrease in Florida’s workers’ compensation rates. Following NCCI’s
presentation, a representative of the Insurance Consumer Advocate (ICA) testified
that he believed the rate decrease should be closer to 36.3%.
Business community members testified at the hearing and congratulated the Office
of Insurance Regulation for the work have done in bringing down employer rates
in tandem with the success of the 2003 reforms. However, they cautioned against
weakening the insurance companies capitalization requirements because restoring
stability to Florida’s workers’ compensation marketplace, with
available and affordable coverage for employers was the primary goal of the
Florida Legislature’s 2003 reforms.
A representative of the Florida Workers Advocates – a group of trial
attorneys who represent workers’ compensation claimants hinted they may
soon seek legislation to expand benefits. Obviously, such efforts would increase
rates to employers and would likely throw the Florida market into another decline.