Error processing SSI file
State Insurance Department approves 5 percent increase in average workers' comp premiums

What's New

Error processing SSI file

July 18, 2005

State Insurance Department approves 5 percent increase in average workers' comp premiums

The state Insurance Department has approved a 5 percent increase in the average workers’ compensation premium for the 12-month period beginning October 1.

The state’s Compensation Insurance Rating Board (CIRB) had requested an increase of 16.1 percent in average premiums.

Assessments, a tax added to premiums that supports special-purpose funds and the staffing of the Workers’ Compensation Board (WCB), will also increase, from the current rate of 15.1 percent to the new rate of 17.5 percent.

In testimony submitted to the Insurance Department earlier this month on the proposed increase, The Business Council argued that the proposal showed again the pressing need for cost-cutting reforms to New York’s workers’ compensation system.

“We know why our costs today are high, and we know what reforms will begin to correct the problem,” the Council’s testimony said. “We know that we can give increase benefits that New York offers to injured workers and, with the right reforms, still reduce employers costs."

New York’s workers’ compensation costs are 72 percent above the national average on a costs- per-case basis, statistics from the independent National Council on Compensation Insurance (NCCI) show. This above-average cost imposed on employers is due almost exclusively to cases for which open-ended benefits are given to workers without specific statutory schedules.

These case account for 14 percent of claims, but more than 77 percent of all compensation costs.

Reform ideas that would help rein in costs include:

A 2004 Business Council survey of New York State employers showed that workers’ comp costs are one of the most damaging burdens holding back New York in its pursuit of prosperity.

Survey respondents overwhelmingly said their workers’ compensation costs have increased in the last five years, and that these costs limit employers’ opportunities to grow, hire new workers, and sustain other business investments.

In fact, more than a third of respondents to the survey said New York’s workers’ compensation costs are encouraging them to consider re-locating their business out of state. And about one in five respondents said these costs are forcing their businesses to either leave the state or expand elsewhere.

Error processing SSI file
Error processing SSI file