The Colorado Division of Insurance (DOI) published a bulletin announcing that it has approved a rate reduction for a component of workers' compensation premiums for 2025.
A reduction of 4.3% has been approved for the average loss costs component of the workers' compensation premium. Loss costs represent the average cost of lost wages and medical payments of workers who qualify for workers' compensation. Factors contributing to the average loss costs include frequency of injuries, severity of injuries, and medical costs.
The reduction marks the eleventh straight year of reductions of the average loss costs component in Colorado, totaling a cumulative 53.5% reduction in that time. The 4.3% decrease represents an average–an employer's specific rate change may be different depending on their classification or industry type. Additionally, some employers may see an increase in premiums if the other components that make up the premium offset the reduction.
All insurers transacting workers' compensation in Colorado must use the new rates starting January 1, 2025.
The bulletin can be found here.
Ray Sugrim
Ray Sugrim is an Insurance Editor with FC&S Expert Coverage Interpretation, a division of National Underwriter Company and Arc Network. Ray is responsible for helping develop and edit content for subscribers. Ray is a St John’s University graduate with a degree in Risk Management & Insurance and is a CPCU candidate.