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Premiums for workers’ compensation insurance next year will increase for the first time in three years, the Department of Labor and Industries announced today.
The average 2.7 percent rate increase for 2014 premiums is an increase of less than two cents per hour worked.
This modest increase in rates is part of a long-term plan to ensure steady and predictable rates by benchmarking against wage inflation,” said L&I Director Joel Sacks. “It will also help to gradually rebuild the workers’ comp reserves.”
Noting that the 2011 reforms are projected to save approximately $150 million in the fiscal year that ends next July, Sacks said the agency will do even more to reduce costs. “We are looking at every step in the claims process for ways to lower costs while getting better results for injured workers. We’ve committed to reducing costs by $35 to $70 million by June 2014 through initiatives that improve efficiency and address the needs of our customers,” he added.
The rate increase, which will bring in about $55 million in additional premiums next year, is an average for all Washington employers. Individual employers could see their rates go up or down, depending on their recent claims history and any changes in the frequency and cost of claims in their industry. L&I held public hearings on the proposed rates around the state in October. The 2014 rates by industry are available online.
Washington is the only state where workers contribute a substantial portion of the premiums. Next year, their share will be about 25 percent.
Washington’s workers’ compensation system, the seventh-largest industrial insurance system in the United States, provides coverage to about 2.5 million workers and more than 160,000 employers. L&I also oversees workers’ compensation programs that cover an additional 870,000 workers whose employers self-insure. About 100,000 workers file injury claims with L&I each year.