- Florida’s Office of Insurance Regulation approved a 15.1 percent decrease in industrial and a 12.6 percent decrease in “F” class workers’ compensation rates for 2024, continuing a seven-year trend of rate reductions.
- The rate cuts, based on 2020-2021 data, were proposed by the National Council on Compensation Insurance, reflecting a stable and competitive market.
- Nationwide, workers’ compensation claims are decreasing, but claim costs and medical inflation are rising, with medical inflation expected to grow at about 3 percent annually.
Florida’s Office of Insurance Regulation on Nov. 9 approved a decrease in workers’ compensation insurance rates for 2024, marking the seventh consecutive year of rate decreases.
Effective January 1, the reduction applies to both new and renewal policies across the state and will see a 15.1 percent decrease for industrial class coverages and an overall decrease of 12.6 percent for “F” class insurance premiums.
“I’m pleased to announce that Florida businesses will see a reduction in workers’ compensation rates for the seventh consecutive year,” said Insurance Commissioner Michael Yaworsky. “It’s clear the workers’ compensation market in Florida is stable and competitive; I’m confident lower workers’ compensation rates will assist in ensuring that all of Florida’s businesses have the opportunity to succeed in our state.”
In August, the National Council on Compensation Insurance (NCCI) put forth a proposal recommending the now-authorized rate adjustments. The suggested reduction was predicated upon an analysis of data derived from Policy Years 2020 and 2021, according to a report filed by the organization, extending up until the end of 2022.
On a broader scale, the workers’ compensation system across the nation reflects positive trends, with the NCCI reporting that lost-time claims relative to premium payments recorded a 4 percent decline compared to the year prior, aligning with a resurgence in employment and wage growth, which have returned to pre-pandemic levels.
“The performance of the workers’ compensation system remains healthy. Lost-time claims relative to premium have returned to their 20-year trend trajectory, declining 4 percent in the past year,” states the NCCI. “Employment and wage growth marked a return to pre-pandemic levels.”
Notably, the recent increases in wages outpace the average costs of claims, and there is an overall decrease in total workers’ compensation claims. Moreover, claim costs rose in 2022, with overall expenditures stemming from claims increasing by around 5 percent and indemnity claim costs rising by approximately 6 percent.
Nationally, medical inflation is predicted to increase at a rate of about 3 percent annually compared with the long-term average of approximately 1.5 percent while remaining below the inflation rate of the Consumer Price Index.