San Francisco, CA – WCIRB President Bill Mudge and Chief Actuary Dave Bellusci recently testified at a public hearing held in Sacramento by California Insurance Commissioner Dave Jones with respect to the WCIRB’s January 1, 2013 Pure Premium Rate Filing. The filing was submitted to the California Department of Insurance on August 21, 2012 and later amended on October 1, 2012.
The filing contains proposed January 1, 2013 pure premium rates that average $2.38 per $100 of payroll, the industry average filed pure premium rate as of July 1, 2012, and proposed changes to the Commissioner’s regulations contained in the California Workers’ Compensation Uniform Statistical Reporting Plan – 1995 and the California Workers’ Compensation Experience Rating Plan – 1995.
The filing data shows a continued deterioration in insurer loss experience and, after reflecting the impact of Senate Bill No. 863 (SB 863), an actuarially indicated average pure premium rate of $2.61 per $100 of payroll. Despite the indication, the WCIRB did not propose an overall increase in advisory pure premium rates effective January 1, 2013. In his testimony, Mr. Mudge noted that with the enactment of comprehensive reform legislation, there is an unusually high level of uncertainty surrounding yet to be developed regulations and there is the potential for additional savings from SB 863 in the actuarial projections and the potential for significant additional cost savings beyond that which is currently quantifiable. Mr. Bellusci advised the Commissioner that the WCIRB will be actively monitoring emerging post-reform costs and will again review the most current insurer experience in the first quarter of 2013 in consideration of a potential July 1, 2013 pure premium rate filing.
The public record for the hearing will close at 5:00 pm, November 19, 2012. Once closed, the Insurance Commissioner has 30 days to issue his decision, in which he may accept, reject or modify the WCIRB’s recommendation.
The filing and related information is available in the Regulatory Filings section of the WCIRB website.