Workers' Compensation Insurance
Rates Set to Decline
for Third Consecutive Year
Commissioner of Insurance Jim Donelon reports that Louisiana
businesses are expected to see a decrease in their workers'
compensation rates in 2016. The National Council on
Compensation Insurance (NCCI) recently proposed an overall
decrease of 2.7 percent for Louisiana employers from its
2015 workers' compensation loss costs. NCCI is a national
organization which analyzes workers' compensation data and
files loss costs or rates in 35 states.
Most workers' compensation carriers in Louisiana use the
NCCI annual loss cost filing to formulate their insurance
rates. This loss cost reduction would mark a cumulative
drop in workers compensation rates of 38 percent since 2006
and a 51 percent drop since 1996.
"The workers compensation market in Louisiana continues to
be competitive and our businesses are benefitting. In 2007,
there were 197 companies writing workers comp; by the end
of 2014 we had 235 companies writing here — an increase of
19 percent," said Commissioner Donelon. "That competition
is also bringing costs down, with companies today paying
nearly 40 percent less for the same coverage as they were
10 years ago."
Donelon added that the reduced rates are also the result of
fewer and less severe workplace injuries. In fact,
data from
the Bureau of Labor Statistics shows the overall rate of fatal
work injuries in Louisiana dropping from 7.3 in 2008 to 6.3
in 2013. Fatal injury rates represent the rate of fatal
occupational injuries per 100,000 full-time workers per year.
Louisiana Department of Insurance actuaries will review the
NCCI filing and if approved, it will take effect May 1, 2016.
The most recent NCCI filing approved was a 2.4 percent decrease
which took effect May 1, 2015.
The total Louisiana workers' compensation market is estimated
to be more than $990 million in total premium.