The California Insurance Commissioner has issued a Decision regarding the Workers’ Compensation Insurance Rating Bureau of California’s (WCIRB’s) January 1, 2020 Pure Premium Rate Filing (Filing), which was originally submitted to the California Department of Insurance (CDI) on August 20, 2019. (See WCIRB Submits January 1, 2020 Pure Premium Rate Filing to CDI.) A public hearing regarding the Filing was held on October 14, 2019.
In his Decision, the Insurance Commissioner approved advisory pure premium rates that average $1.52 per $100 of payroll. The average approved pure premium rate is 9 percent less than the average of the current January 1, 2019 advisory pure premium rates. This decrease represents the ninth consecutive advisory pure premium rate decrease since early 2015, totaling approximately 47 percent.
The approved January 1, 2020 advisory pure premium rates differ from the pure premium rates proposed in the WCIRB Filing, which averaged $1.67 per $100 of payroll. The approved pure premium rates differed from the WCIRB’s proposed pure premium rates in that the pure premium rate projection reflected in the CDI Decision (1) reflected June 30, 2019 loss experience that was not available at the time of the WCIRB Filing, (2) incorporated incurred loss development in part to project ultimate medical losses and (3) reflected lower claim severity trends of -1 percent for indemnity and +1.5 percent for medical in lieu of the -0.5 percent for indemnity and +2.5 percent for medical reflected in the WCIRB Filing.
Insurance Commissioner’s Decision
January 1, 2020 Pure Premium Rate Filing
2020 Advisory Pure Premium Rates: XLS File | Delimited File
WCRATE (abbreviated class wording and pure premium rates): Delimited File | Product Documentation