Pa. workers’ comp costs to drop by nearly 6 percent this year

Most Pennsylvania businesses will see a drop in their workers’ compensation insurance rates starting April 1.

Workers’ compensation insurance covers the cost of medical care and rehabilitation for injured workers, lost wages and death benefits for the dependents of those killed in work-related accidents.

Workers’ compensation insurance rates will drop 5.99 percent, reducing a key expense for many companies and saving businesses in the state about $140 million this year.

The reduction comes following the state Insurance Department’s approval of the Pennsylvania Compensation Rating Bureau’s annual loss cost filing, which is used to determine premiums.

Ronald Ruman, spokesman for the Insurance Department, said essentially that workers’ comp costs were lower last year because of a combination of a reduction in claims and lower claim amounts. A major factor in determining the premiums each year is the amount paid out by the program the prior year.

He said there are many worker-safety programs in place throughout the state, which have helped to reduce the number of incidents that cause worker injury.

“We are proud of the role our Bureau of Workers’ Compensation Health & Safety division plays in the keeping our workers safe,” added Acting Labor & Industry Secretary Kathy Manderino. “It’s clear that employer safety programs produce tangible benefits and cost savings.”

Ruman said having a competitive marketplace for the state to obtain workers’ compensation insurance coverage also helps reduce the rate.

Gov. Tom Wolf called the reduction good news.

“These rate reductions will go a long way toward ensuring business owners can continue to create and support jobs that pay in Pennsylvania,” he said.

This is the fourth consecutive workers’ compensation insurance cut in as many years, and brings the cumulative savings to $550 million during that time.

The premium savings for an individual employer will vary based on the employer’s risk classification, claims experience and other factors. Not all employers will see a decrease.

Employers should contact their insurance company or agent for more information about how their workers’ compensation premiums will be affected.

Source: LVB.com