California's state run workers' compensation insurer of last resort announced today that it will maintain its current coverage rates going into next year.
The State Compensation Insurance Fund opted to maintain its current average collectible rate level despite the Workers' Compensation Insurance Rating Bureau's filed recommendation for a 5.2 percent average rate increase effective Jan. 1, 2008.
However, it did adopt WCIRB's recommended changes to individual class loss costs, meaning that some employers may see their rates increase or decrease, although the average will remain the same.
SCIF is the largest workers' comp insurer in the state.
"Employers are enjoying the benefit of a healthy, competitive workers' compensation market that is directly attributable to passage of the governor's reform legislation in 2004, SB 899, and earlier 2003 reform legislation, AB 227 and SB 228," said Janet Frank, president of State Fund.
She added that the rate filing "reflects our role as a carrier of choice for many employers, as well as the safety net for any employer needing workers' compensation insurance in California."
Jeanne Cain, the chair of the fund's board, said prices are "down substantially from their high point in 2003 and stable going into 2008." According to the fund, its current rates are 55 percent below those prior to the passage of the reforms.
The fund also announced that it would continue to offer a 10 percent workplace safety credit to small employers with superior safety records. "Small businesses are crucial to the California economy. State Fund is pleased to be able to reward these employers for maintaining safe workplaces," said Ms. Frank.
To qualify as a small business, the fund said firms would have to have premiums of $1,000 or more but less than $60,000.
Created by state law in 1914, State Fund was designed to serve as a nonprofit, self-supporting public insurer to help businesses obtain coverage for employees. As the market for comp coverage worsened during the 1990s, however, the fund has grown to be the largest workers' compensation insurer in the state.
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