Earlier today, the WCIRB Governing Committee met in San Francisco for the first time following the March 21, 2013 election of Employers Compensation Insurance Company and Hartford Accident and Indemnity Company to serve three-year terms on the Governing Committee. At the beginning of the meeting, the Committee members elected Kevin Harnetiaux from Hartford Accident and Indemnity Company to serve as the Committee Chairman for the next two years.
The Committee also discussed the WCIRB Actuarial Committee’s review of December 31, 2012 insurer experience and a potential July 1, 2013 Pure Premium Rate Filing. In his presentation to the Committee, Executive Vice President, COO and Chief Actuary Dave Bellusci reported that (1) statewide premium has increased significantly due to increases in the average rate level and increases in insured payroll, (2) loss development projections are consistent with those underlying the January 1, 2013 Pure Premium Rate Filing, (3) accident year 2012 claim frequency is increasing modestly while loss severity remains relatively flat, and (4) allocated loss adjustment expense severity trends are beginning to moderate.
The Actuarial Committee’s analysis shows the July 1, 2013 indicated average pure premium rate is $2.61 per $100 of payroll which is the same as the indicated average pure premium rate contained in the WCIRB’s amended January 1, 2013 Pure Premium Rate Filing and only $0.06 cents more than the industry average filed pure premium rate as of January 1, 2013.
Mr. Bellusci also noted that at this time, there is no new information available about the impact of SB 863; however, the WCIRB, in conjunction with a broad cross section of industry experts, has developed a detailed plan to track the impact of the bill. The Senate Bill No. 863 WCIRB Cost Monitoring Plan has been submitted to the Insurance Commissioner and the WCIRB Governing Committee.
After some discussion, the Governing Committee unanimously agreed not to submit a July 1, 2013 Pure Premium Rate Filing. Instead, the Actuarial Committee will continue reviewing insurer experience in preparation for the regular January 1, 2014 Pure Premium Rate Filing to be submitted this August.