Insurance Commissioner Dave Jones issued arevised workers' compensation insurance advisory pure premium rate,lowering the benchmark to $1.74 per $100 of payroll for workers'compensation insurance, effective June 1, 2018. The order sets theadvisory pure premium rate below the $1.80 average recommended bythe Workers' Compensation Insurance Rating Bureau in itsfiling.

Commissioner Jones has reduced the benchmark rate by 36.5% sinceJanuary 2015, when the average pure premium rate was $2.74 per $100of payroll. With an average filed pure premium rate of $2.22 per$100 of payroll as of January 1, 2018, insurers are on averageapplying pure premium rates that are 27.6% more than the indicatedpure premium rate approved by the Commissioner today.

“It is time insurers do the right thing and pass along morecost savings to California employers who deserve to share in thebenefits cost reductions have brought to the workers' compensationsystem,” said Commissioner Jones in a statement. “In addition tothe cost reductions that have led to higher profits, insurers arealso benefiting from the federal income tax break, whichshould result on average in about another 5% decrease inpremiums.”

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