CHARLESTON, W.Va. – Gov. Earl Ray Tomblin, joined by business leaders, announced recently that the West Virginia Offices of the Insurance Commission has approved of a reduction in loss costs rates for workers’ compensation insurance from the National Council on Compensation Insurance Inc. (NCCI).
This filing will result in an overall decrease of 8.1 percent and a projected premium reduction of $31 million for all West Virginia employers. The new loss cost will become effective on November 1, 2011.
“West Virginia employers and their employees have benefited from tough decisions made by West Virginia’s leaders over the past several years. By addressing serious problems in the former state run workers’ compensation program, we have successfully put West Virginia in a competitive position for continuous job growth and these new workers’ compensation rates reflect that,” said Gov. Earl Ray Tomblin.
Loss cost is the estimated amount necessary to pay all medical and indemnity costs associated with workers’ compensation claims. Because loss cost is developed for each individual classification, some employers will see their loss cost increase while others will experience varying decreases or no change. All workers’ compensation insurance carriers use loss cost to calculate rates.
Out of 590 classifications, 497 will decrease, 62 will increase, 24 will see no change, and there are now seven new class codes. Close to 95 percent of West Virginia employers’ payroll is in loss cost classifications that are declining or remaining neutral.
“This is fantastic news not only for the business community, but for all of West Virginia,” said Janet Vineyard, President of West Virginia Oil Marketers and Grocers Association. “The bold decision to privatize the workers’ compensation program several years ago made today’s announcement possible.”
“This additional reduction in workers’ compensation costs will further improve the job climate in West Virginia and demonstrates that passing workers’ compensation reform has, once again, proven to be in the best interests of West Virginia’s future,” said Steve Roberts, President of the West Virginia Chamber of Commerce.
NCCI is West Virginia’s rating and statistical agent that calculates and files the loss cost based on an actuarial analysis. NCCI also provides services to 38 other states.
Source: WV Governor’s Office