Delaware: New comp rate cuts will bring total reduction to 45 percent by end of '09
The latest order by Insurance Commissioner Matthew Denn represents the second such cuts in 2008. The move requires that the state's workers' comp insurance companies discount average premiums by 6 percent each year in 2008, 2009 and 2010, and by 5 percent in 2011. In combination with the 11.5 percent rate reduction in August, Denn said, average workers' comp rates will have been cut by more than 45 percent since November 2007.
Denn said the rate cut was ordered to ensure that policyholders -- rather than insurance companies -- benefit from the impact of Delaware's new medical fee schedules for treatment of workers' comp injuries, which were part of reform efforts passed by the Legislature in 2007. Analysis by Denn's office found that proposed rates had not properly accounted for workers whose treatments followed the implementation of the fee schedule on May 23, 2008.
"This rate cut will save millions of dollars for Delaware employers at a time when they could certainly use it," Denn said. "The dramatic lowering of workers' comp rates that has resulted both from reform legislation and from increased scrutiny by the Department of Insurance is one of the real achievements of my time as insurance commissioner."
Denn said Delaware employers should begin to see the impact of the latest rate cut order in 2009 as their workers' comp policies come up for renewal. Most policyholders have already seen reductions in their workers' comp rates due to the rate reductions that were ordered in 2007.
December 1, 2008
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