The Workers’ Compensation Insurance Rating Bureau of California (WCIRB) has taken a significant step regarding workers’ compensation insurance rates. On Wednesday, the governing committee approved a plan to submit a new filing for pure premium rates. This filing is set for September 1, 2025, and it proposes rates that are, on average, 11.2% higher than those approved for September 1, 2024.
These proposed rates will be based on the losses and expenses that insurers have experienced from accident years 2024 and earlier, with a valuation date of December 31, 2024. Tony Milano, the WCIRB’s Executive Vice President and Chief Actuary, pointed out that this increase reflects a number of factors. He noted that there has been a rise in medical loss development, an uptick in cumulative trauma claims, and higher average medical costs. Additionally, the costs related to loss adjustments have also gone up.
The WCIRB plans to submit this filing to the California Department of Insurance by the end of April. After submission, the Department will hold a public hearing to discuss the proposed changes. This move comes as California’s workers’ compensation system continues to evolve, especially in light of recent trends observed in the industry.
The implications of these proposed rate increases could affect businesses across the state, as they may face higher costs for workers’ compensation insurance. As the WCIRB works through this process, stakeholders will be watching closely to see how these changes play out in the coming years.