15 Sep Florida’s Workers’ Compensation Insurance Rates Expected to Decrease in 2021
Florida employers may see lower workers’ compensation insurance premiums in 2021. The National Council on Compensation Insurance is proposing a statewide average rate decrease of 5.7 percent for 2021. NCCI is a licensed rating organization authorized to submit workers’ compensation rate filings on behalf of insurance companies in Florida. NCCI’s proposed rate decrease, which must be approved by Florida’s Office of Insurance Regulation, would apply to new and renewal policies effective January 1, 2021.
Why are rates going down? According to NCCI, the workers compensation system is experiencing unprecedented results nationwide. The frequency of claims continues to decrease due to technology, safer workplaces and improved risk management. NCCI also credits the combination of underwriting discipline, moderating severity, declining frequency and adequate reserves for controlling loss ratios.
It’s worth noting that the data used to calculate the proposed rate decrease does not include claims from coronavirus disease 2019 (COVID-19). NCCI is gathering and reviewing data, but it’s too soon to know how COVID-19 may directly or indirectly impact claims frequency, severity or duration. While it’s possible that COVID-19 could result in significant claims and deteriorating loss ratios, NCCI notes that the pandemic’s overall impact on system costs may be small. An increase in compensable claims for frontline workers, for example, may be offset by a decrease in workers’ compensation claims due to the increased number of employees working remotely due to the pandemic. Again, it’s too soon to know for sure.
Florida’s Office of Insurance Regulation is currently reviewing NCCI’s rate filing to ensure the proposed rates are not excessive, inadequate or unfairly discriminatory. The OIR is also evaluating potential effects on the insurance marketplace and on employers required by law to carry workers’ compensation insurance. Once the proposed voluntary rate level change is determined, NCCI separately determines rates for each workers compensation job classification (class code).
Please contact us if you have any questions about employee classification codes or want to discuss ways to lower your workers’ compensation insurance premiums.