Florida Office of Insurance Regulation Approves Seventh Consecutive NCCI Workers’ Compensation Rate Decrease
Oct 26, 2009
The Florida Office of Insurance Regulation (“OIR”) announced today, October 26, 2009, that it has approved the National Council on Compensation Insurance (“NCCI”) amended October 19, 2009 rate filing.
Florida Insurance Commissioner Kevin McCarty had issued an initial Order on October 15 in which he found that the 6.8 percent reduction in NCCI’s original rate filing was justified. However, he took exception to methods used to determining that rate, among which included the calculation of policyholder dividends, cost of capital, investment yields, minimum premiums and proposed roofing rate. NCCI subsequently amended its filing.
The approval will implement a rate decrease of 6.8 percent for all Florida new and renewal workers’ compensation insurance policies on January 1, 2010.
Today’s OIR press release regarding Florida Insurance Commissioner Kevin McCarty’s final Order is reprinted below. To view the Order, click here.
Should you have any questions or comments, please contact Colodny Fass.
Florida Insurance Commissioner Approves Seventh Consecutive Rate Decrease for Workers’ Compensation
Monday, October 26, 2009
TALLAHASSEE, Fla. – Florida Insurance Commissioner Kevin McCarty today issued a final order approving the National Council on Compensation Insurance’s (NCCI) amended rate filing for workers’ compensation insurance rates that will become effective Jan. 1. The 6.8 percent rate decrease marks the seventh annual consecutive drop in worker’s compensation rates since 2003, the year the Florida Legislature passed sweeping reforms of the workers’ compensation system.
The Office conducted a hearing on Oct. 6, 2009, and heard testimony from NCCI, industry experts and the public about NCCI’s initial Aug. 20 rate filing.
Commissioner McCarty issued an order on Oct. 15 finding the 6.8 percent reduction in NCCI’s original rate filing justified, but he took exception to some of NCCI’s methodologies used in determining that rate; including its calculation of policyholder dividends, cost of capital, investment yields, minimum premiums and proposed roofing rate. That Order requested NCCI to modify its original filing and resubmit it; which it did on Oct. 19.
Today’s final order approves the NCCI’s amended rate filing in its entirety and notes all requested changes in Commissioner McCarty’s Oct. 15 order have been made. The NCCI’s amended rate filing for workers’ compensation insurance rates will become effective Jan. 1.
With this rate change, the cumulative overall statewide average rate decrease since 2003 will be more than 63 percent.
The overall average rate impact at an industry group level will be as follows:
Percent Change
Industry Group 1/1/10 Filing Cumulative 10/1/03-1/1/10
Manufacturing -4.7% -60.0%
Contracting -10.8% -65.4%
Office and Clerical -6.2% -63.3%
Goods and Services -3.8% -62.2%
Miscellaneous -6.7% -62.1%
TOTAL -6.8% -63.2%
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