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California’s Workers Compensation Difficulties – Great Primer


California’s Workers Compensation Difficulties

California’s Workers Compensation difficulties may have subsided for a few years.  However, it seems that it was only a temporary situation.

Diagram of California's Workers Compensation Difficulties Insurance Market Share by Types of Insurer
(c) dir.ca.gov

Workers Compensation Action Network (WCAN) recently responded to ProPublica’s and NPR’s analysis of Workers Comp in California.   A recent responsive article was also published on this blog – In Defense of Workers Compensation.

I am often asked why I write a large number of articles on California’s Workers Compensation system. California is a leading bellwether of WC (of sorts).  In other words, what happens in the state will likely become part of the WC environment  in your  location or states of operations.

The article actually turned out to be a great quick primer on quite a few developments in California over the last few years.   One note is Propublica did meet with a few of the Workers Comp press and requested input on future WC subject matter.

Even if your company has not exposure in CA, I recommended reading the seven page analysis published by WCAN.   They performed a yeoman’s job to bring together the article.  Please note the response is a PDF file.

Some of the statistics in the report are:

Hand Illustrating California's Workers Compensation Difficulties Chart
  • Premium rates in California are 30% higher than they were four years ago.  That is a significant increase when many states are experiencing rate decreases.
  • Since 2004, average total benefits per claim in California have increased by 35%, or $18,000 per claim.
  • Average payments for medical benefits per claim increased by 40%.
  • Average indemnity (cash) benefits paid to injured workers increased by 27%.
  • Benefit costs did decline briefly after enactment of SB 899 (2004). However, this trend only lasted for three years and costs declined by only 17% before beginning to increase again in 2006.

When one looks at these statistics, California may not necessarily be in an “insurance crisis“, however the cost of covering workers is becoming even more of a significant budget burden on California employers.

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James J Moore - Workers Comp Expert

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Management Consultants, Inc. in 1996. J&L’s mission is to reduce our clients’ Workers Compensation premiums by using time-tested techniques. J&L’s claims, premium, reserve and Experience Mod reviews have saved employers over $9.8 million in earned premiums over the last three years. J&L has saved numerous companies from bankruptcy proceedings as a result of insurance overpayments.

James has over 27 years of experience in insurance claims, audit, and underwriting, specializing in Workers’ Compensation. He has supervised, and managed the administration of Workers’ Compensation claims, and underwriting in over 45 states. His professional experience includes being the Director of Risk Management for the North Carolina School Boards Association. He created a very successful Workers’ Compensation Injury Rehabilitation Unit for school personnel.

James’s educational background, which centered on computer technology, culminated in earning a Masters of Business Administration (MBA); an Associate in Claims designation (AIC); and an Associate in Risk Management designation (ARM). He is a Chartered Financial Consultant (ChFC) and a licensed financial advisor. The NC Department of Insurance has certified him as an insurance instructor. He also possesses a Bachelors’ Degree in Actuarial Science.

LexisNexis has twice recognized his blog as one of the Top 25 Blogs on Workers’ Compensation. J&L has been listed in AM Best’s Preferred Providers Directory for Insurance Experts – Workers Compensation for over eight years. He recently won the prestigious Baucom Shine Lifetime Achievement Award for his volunteer contributions to the area of risk management and safety. James was recently named as an instructor for the prestigious Insurance Academy.

James is on the Board of Directors and Treasurer of the North Carolina Mid-State Safety Council. He has published two manuals on Workers’ Compensation and three different claims processing manuals. He has also written and has been quoted in numerous articles on reducing Workers’ Compensation costs for public and private employers. James publishes a weekly newsletter with 7,000 readers.

He currently possess press credentials and am invited to various national Workers Compensation conferences as a reporter.

James’s articles or interviews on Workers’ Compensation have appeared in the following publications or websites:

  • Risk and Insurance Management Society (RIMS)
  • Entrepreneur Magazine
  • Bloomberg Business News
  • WorkCompCentral.com
  • Claims Magazine
  • Risk & Insurance Magazine
  • Insurance Journal
  • Workers Compensation.com
  • LinkedIn, Twitter, Facebook and other social media sites
  • Various trade publications


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