San Francisco, CA – On March 20, 2013, the WCIRB’s Actuarial Committee met to review December 31, 2012 insurer experience and other related information. Actuarial Committee meetings are open to the public and nearly 50 people were in attendance representing insurers, brokers, consultants, the California Department of Insurance and members of the press.
The meeting was the first Actuarial Committee meeting of 2013 and begins the Committee’s review of accident year 2012 experience which will ultimately form the basis of any future recommended changes to the advisory pure premium rate level.
Some of the key information discussed at the meeting included:
- The Committee reviewed the proposed SB 863 Cost Monitoring Plan and recommended its submission to the Insurance Commissioner.
- There was a very sharp increase in lien filings in the fourth quarter of 2012 in anticipation of new lien filing and activation fees as part of SB 863. In total, DWC data shows almost 1.2 million liens being filed in 2012 compared to less than 500,000 in 2011.
- Paid indemnity and medical loss development continued to deteriorate in the fourth quarter of 2012.
- The WCIRB’s initial projected ultimate loss ratio for accident year 2012 is 80%, which is somewhat below the current estimates ranging from 87.4% to 90.8% for the prior three accident years.
- The WCIRB projected July 1, 2013 policy period loss to filed pure premium ratio of 91.7% is less than one percentage point higher than that reflected in the WCIRB’s amended January 1, 2013 pure premium rate filing.
- The Committee adopted several refinements to the WCIRB loss projection methodologies to reflect the anticipated impact of SB 863 on loss development and trend.
The Committee will meet again on April 1 to review additional December 31, 2012 loss information, as well as updated information on insurer loss adjustment expenses and insurer filed rates of January 1, 2013.
Copies of materials presented at the meeting can be viewed on the Actuarial Committee page of the WCIRB Website (www.wcirb.com). Minutes to the meeting will be posted to the WCIRB website when available.
Source: CA WCIRB