In 2020, Missouri Workers Comp Rates will be declining for the 6th consecutive year
Earlier in December of 2019, the Missouri Department of Commerce and Insurance recommended a 1.6 percent decrease for workers compensation loss costs next year. If approved, this decrease marks the sixth consecutive year of declines for Missouri Workers Comp Rates in 2020.
The reason for the decrease in premium for 2020 is because of declining lost-time claim frequencies and increasing average medical claim costs. In a statement from Chlora Lindley-Myers, Director of the Department of Commerce and Insurance, “Missouri’s lost-time claim frequency continues to decrease due to safety improvements in the workplace, but average medical claim costs have increased every year since 2014,”
When Missouri Workers Comp Rates decline it is a boom to the economy throughout the state. Not all businesses nor all industries will experience positive rate declines. Depending upon the businesses experience modification rating, the classification code of the business, and the annual revenue of the business; some businesses may experience more or less of a decline in workers comp premium. The NCCI’s proposed average changes in loss costs by industry group are:
- Manufacturing: -0.7%
- Contracting: -1.7%
- Office and Clerical: -1.6%
- Goods and Services: -1.9%
- Miscellaneous: -1.8%
Washington Workers Compensation Rates will be declining by a modest 0.8%
As of the first of January 2020, Workers Compensation Rates for the business community in the state of Washington will be staying relatively stable. The Washington Department of Labor & Industries (L&I) announced a moderate decline of 0.8% in 2020. While the decline this year is modest, it is the third consecutive year of declining Washington Workers Comp Rates 2020. The previous two years included a 5 percent cut in 2019 and a 2.5 percent cut in 2018. Before these declines, rates for Workers Compensation in Washington were the 16th most expensive rates in the country.
According to L&I Director Joel Sacks, “Our workers’ compensation system is in good shape. Every year we help tens of thousands of people recover from on-the-job injuries and go back to work. Our programs to help injured workers are making a real difference, and workplace injury rates in Washington are declining. That’s great for workers and their families and is helping us keep costs down.” Because of the high cost to purchase workers compensation coverage, any movement in a positive direction is welcomed by the small business community.
The Workers Compensation System in the stte of Washington is unique. First and foremost, it is unique because it is what is referred to within the insurance industry as a monopolistic state. North Dakota, Ohio, and Wyoming are also monopolistic states. The term monopolistic comes from the fact the state requires employers to purchase coverage from a government-operated insurance fund. This is especially important for businesses that operate across state lines. Workers compensation is governed by the state governments, not at the federal level. Most states have reciprocity rules in place to deal with issues involving multiple states. Monopolistic states require any business operating in any capacity to purchase some form of coverage within the state. Usually a stop-gap insurance product can meet the reqirements for coverage needs that aren’t covered by the funds in each state they operate in.
The Workers Comp System in New Jersey will experience changes in 2020
Previously in 2019, the State Senate in New Jersey approved a series of adjustments to the supplemental benefits for some types of injured workers. These are workers receiving compaensation within the workers compensation system. As a result of these changes, insurance carriers anticipate increased costs to cover injured workers throughout the state. Because of these changes, New Jersey Workers Comp Rates in 2020 may be the same or more compared to previous years.
In September of 2019, The New Jersey Department of Banking and Insurance requested a 3.8% decrease in overall premium effective January 1, 2020. At the moment, this is just a recommendation. If approved, this work mark the 4th consecutive year of declining rates within the state of New Jersey. The recommended decarease is based upon several years of declining claims throughout the state and an annual review of classification relativity. This is good news, because since 1997 the amount paid out for Temporary Disability and Total Disability has nearly doubled ($496 max /$132 min in ’97 and $945 max/$252 min in 2020). Experiencing a few ears of better claims frequency is certainly good news compared to these increases over the past two decades.
This is good news, but business owners should plan for an increase in the years ahead. Increases or moderate declines may be coming because at the current time, the amount paid out for Total Permanent Disability (70% of wages) is now at a maximum rate of $945.00 and a minimum rate of $35.00 per week. The amount paid for Temporary Disability (70% of wages) is now set at a maximum rate of $945.00 per week and a minimum rate of $252.00 per week. The maximum duration a person can be on temporary disability is currently at 400 weeks. Death benefits are again at 70% of wages with a maximum rate of $945.00 and a 450 weeks plus the spouse’s statutory benefits. An allowance for funeral is now capped at $3,500.00.