Cost of workers' comp stabilizing

Saturday, April 10, 2004

JEFFERSON CITY, Mo. -- After two straight years of sizeable increases, the price of workers' compensation insurance is leveling off due largely to a decline in workplace injuries, the state Department of Insurance reported Friday.

Department director Scott Lakin said that of 185 workers' compensation insurers filing rate changes from January through March, 101 plan to reduce their premiums. Most companies change their rates early in the year.

Those reductions, weighed against increases planned by 84 other insurers, mean Missouri employers will pay an average 2.3 percent more for workers' comp coverage this year, Lakin said.

Workers' comp rates rose 14.7 percent last year and 9.2 percent in 2002.

"The overall 2004 rate change should provide welcome relief" to businesses, Lakin said.

Lakin said the larger increases in the two previous years were due almost solely to rising medical costs for treating injured workers.

Medical costs continue to rise, but they have been more than offset by an 18 percent decline in on-the-job injuries during the past two years, Lakin said. The smaller number of workplace injuries is reflected in the rate changes that insurers are making now.

Meanwhile, the private company that runs the state's high-risk workers' comp pool plans to reduce its premiums for the second straight year, saving the 7,500 participating employers about $3 million a year, Lakin said.

The high-risk pool issues coverage for employers who cannot obtain private workers' comp policies because of their safety records or the nature of their work.

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