Louisiana Workers Comp Rates to Drop More Than 4 Percent

Rates for workers compensation insurance continue to decrease in Louisiana based on a recent report from the National Council on Compensation Insurance (NCCI) that analyzes workers comp rates in 35 states it was announced by Commissioner of Insurance Jim Donelon on July 22.

Most workers comp carriers in Louisiana use the NCCI annual loss cost filing report to help formulate their insurance rates. A recent NCCI loss cost filing showed Louisiana with a 4.3% drop in loss costs approved by the Department of Insurance and effective May 1, 2010. (WCxKit)

This reduction marks an overall drop of 40% in rates since 2005. Companies began adopting the new rates from late March through September 2010. They began using the lower rates within approximately 45 days of approval by the Department of Insurance. This reduction follows a 17.4% decrease in workers comp rates in 2009, an 8.6% reduction in 2008 and a 15.8% reduction in 2007. Louisiana has experienced the second highest reduction of the 35 states NCCI analyzes since 2006.

“The continued reduction in the cost of workers compensation insurance is good news for our state’s business community as businesses struggle with the national economic recession, the current oil spill disaster in the Gulf, and our state’s continued recovery efforts from the devastating hurricanes of 2005 and 2008,” said Donelon. “Our workers compensation insurance market continues to show strong signs of improvement, particularly in the area of improved worker safety.”

Donelon notes improved worker safety leads to fewer workplace injuries across most employment classes, a trend seen over the past few years and the leading cause of these recent rate reductions. The Louisiana Workers Compensation Corp. (LWCC) recently announced it is dropping its rates by 4.1%, as of October 1, a drop similar to the announced rate reduction. (WCxKit)

The total Louisiana workers comp market is estimated to be $900 million per year in premiums. According to the Department of Insurance the top five writers of workers comp insurance in Louisiana in 2009 were: LWCC with 24.4%, Liberty Mutual Group with 15.2%, LUBA Casualty Insurance Co. with 10%, American International Group with 8.8% and Zurich Group with 6.4%.

Note: it will be interesting to see what changes might occur in the rates due to the current BP environmental disaster that has contracters coming to the state from all corners of the country.

 
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