Commissioner of Insurance Approves Workers' Compensation Rate Agreement, Saving $65 Million for Businesses
Deal with Attorney General's Office holds rates at current levels, continues Patrick-Murray Administration's record of reducing insurance costs
BOSTON - April 12, 2011 - The Patrick-Murray Administration's Commissioner of Insurance Joseph G. Murphy has signed an agreement that holds workers' compensation rates at current levels, saving businesses $65 million in proposed increases.
The agreement between the Workers' Compensation Rating and Inspecting Bureau (WCRIB), the Division of Insurance's State Rating Bureau, and the Attorney General's Office holds rates at current levels until at least September 2012. The WCRIB had originally asked for an overall 6.6 percent increase.
"Our goal at the Division of Insurance is to make sure that these rates are fair, they protect workers, and that they do not overly burden employers," said Commissioner Murphy. "This agreement does all of those things."
Last year, an agreement with WCRIB cut overall rates 2.4 percent, instead of increasing them 4.5 percent as originally requested. That agreement also saved approximately $65 million in annual workers' compensation insurance premiums. Traditionally, WCRIB files rates proposals every two years, but last year's agreement included a required filing in the next year.
Holding down workers' compensation rates complements other efforts by the Patrick-Murray Administration to bring down insurance costs. The Administration's work to contain health insurance costs saved small businesses and working families $106 million in the last year. The three-year-old reform of auto insurance has delivered hundreds of millions of dollars in savings to drivers across the Commonwealth.
"This is good news for businesses in Massachusetts, particularly small businesses which are the engines of our ongoing economic recovery," said Barbara Anthony, the Undersecretary of the Office of Consumer Affairs and Business Regulation. "The Administration is committed to continued improvement of our business climate, allowing businesses to expand and develop new jobs."
The workers' compensation system was overhauled in 1991, with the focus on efficient claims management, workplace safety, and return-to-work programs. Rates have been cut 19.7 percent by the Patrick-Murray Administration, and studies by the Oregon Department of Consumer and Business Services have found Massachusetts have some of the lowest workers' compensation rates in the country.
Workers' compensation insurance provides coverage for lost wages, permanent injuries, and medical care for workers injured on the job. Massachusetts businesses are required to carry workers' compensation insurance. The Division of Insurance sets the rates through a rate-setting proceeding.
The Massachusetts Division of Insurance ( www.mass.gov/doi) is an agency within the Office of Consumer Affairs and Business Regulation. Follow the Office at www.mass.gov/consumer , its Consumer Connections Blog and at its Twitter feed, @Mass_Consumer.