Insurance Regulators Eye Workers' Comp Rate Cut
Florida insurance regulators Tuesday dug into the details of a proposal that calls for reducing workers’ compensation insurance rates next year by an average of 5.7 percent.
The state Office of Insurance Regulation held a public hearing on the proposal by the National Council on Compensation Insurance, or NCCI, which makes rate filings for the workers’ compensation insurance industry.
While state and NCCI actuaries discussed details of the filing during the hour-long online hearing, no members of the public made comments.
The proposal would be the fourth straight year of premium decreases for employers. Average rates dropped 7.5 percent this year, after reductions of 13.8 percent in 2019 and 9.5 percent in 2018.
Jay Rosen, a senior actuary for NCCI, said the filing does not take into account potential effects of the COVID-19 pandemic on workers’ compensation insurance. The filing was based on data as of the end of 2019, before the pandemic hit the state.
A closely watched issue in the industry involves a 2016 Florida Supreme Court ruling, in a case known as Castellanos v. Next Door Company, which invalidated a law that placed strict limits on fees that could be paid to attorneys for injured workers.
Business groups have long argued that the ruling would drive up costs in the workers’ compensation system. Rosen said expenses such as attorney fees have increased but that other “favorable” cost-related trends in the system have offset the increases stemming from the court decision.
Regulators are expected to decide in the coming weeks whether to approve, reject or order changes in the NCCI proposal. They will accept written public comments until Oct. 23.