A Good Five-Minute Workers Comp Rate Setting Calculation Video
This workers comp rate-setting calculation video caught my eye last week. The State of Washington’s L&I produced the video.
Washington is a Monopolistic State. All employers operating in the state must buy insurance through a state agency. I am not a huge fan of Monopolistic States.
States such as West Virginia and Nevada successfully converted from monopolistic funds to a competitive marketplace. The results were always successful including a reduction in premiums.
Regardless, the video below is well worth the time. All Workers Comp rating bureaus including NCCI (National) WCIRB (California) use the same concept for rate setting.
The Washington L&I website can be found here. I have been in contact with the L&I over the years. They have always been very helpful in locating information.
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2 Responses
Does State Fund, Farmers State Farm, etc. have an employer input meeting to voice opinions?
It seems that this video expresses the rule that the more money spent on employee insurance benefits raises the employer’s insurance premium.
Informative video.
Thank you.
Richard, it is nice to hear from you again. I know of no employer input meetings with any of the Workers Comp insurance carriers. I know that some carriers have proxy meetings where investors can have some input.
Yes, the more benefits that a carrier pays out will eventually (up to 2 years later) will eventually cause employers to pay more premiums.
I wrote an article today on the fact that larger employers pay less per unit of benefits than a smaller employer – the inherent cost of risk.