Workers’ compensation insurance costs will likely fluctuate in 2013 for small and mid-size employers. The National Council of Compensation Insurance has announced that it will change its experience modification calculations. Thirty-eight states, including Nebraska, rely on these calculations in setting their rates. As a result, employers need to be aware that there will likely be a significant change in the premiums they pay for workers’ compensation insurance.
The change will effectively put more weight on the employer’s history of claims when calculating the cost of premiums. As a result, companies with below average loss histories will likely pay less for their workers’ compensation insurance. Companies with above average loss histories will probably see a significant increase in their premiums. These changes could most significantly impact small to mid-sized employers with limited risk management resources. In preparing for this change, employers should review their workers’ compensation plans, policies, and pre-loss/post-loss practices to ensure the best insurance pricing.
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