The state Department of Financial Services held a public hearing June 25 on the filing from the New York Compensation Insurance Rating Board.
Other reasons cited for the proposed rate hike include:
- The average time from accident to classification has been increasing steadily, resulting in longer temporary benefits and higher overall indemnity costs.
- Transfer of costs to carriers due to the closing of the Reopened Case Fund.
- Increase in minimum and maximum weekly benefits.
The proposed 16.9 percent increase came despite a drop in claim frequency that resulted in a negative five-year trend. The WCIRB said severity cost increases outweighed the drop in frequency based on a five-year exponential trend analysis.
"For indemnity severity, the regression resulted in an annual trend of 2.0 percent," the filing said. "For medical severity, the five-year exponential regression produced the indicated annual trend of 4.9 percent."
If approved, the change would affect policies incepting on or after Oct. 1.
By Nancy Grover
Read more at the WorkersComp Forum homepage.
July 22, 2013
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