In 2019 Colorado Workers Compensation Insurance Rates are Declining by 10 percent
Colorado Workers Compensation Insurance Rates in 2019 will be decreasing by 10 percent on average across all classification codes. This decrease will go in to effect on January 1, 2019; representing the fourth straight year Colorado has enjoyed a rate reduction for workers comp coverage. In 2018, rates declined by an average rate of 12.7 percent. In addition to this decrease Pinnacol, the state provider, announced a dividend payout of nearly $70 million. This is also the fourth consecutive year Pinnacol has paid out a dividend.
How is the Market for Colorado Workers Compensation Insurance?
Colorado Workers Compensation Rates are declining for the fourth consecutive year. As of 2017, rates were 19 percent lower than the national average. This year, the Colorado Division of Insurance approved a recommended decrease of 16.7%. This decrease was based on recommendations from the National Council on Compensation Insurance (NCCI).
The loss costs are a component of workers’ compensation insurance premiums that are based upon the average cost of lost wages compared to medical payments to workers who are injured on the job. There are a lot of factors that impact overall workers comp costs, including the frequency and severity of claims, the number of required treatments, the health care costs, and overall costs to cover workers compensation claims. This years decrease in premium can be attributed to a number of factors, but a significant factor was the reduction in the number of claims filed which has fallen from 26.3 million in 2002 down to 18.4 million in 2016.
Not all employers will see a decrease as large as other businesses. Some will see a smaller decrease and some will see no decrease at all. The classification code compared to the experience modification rating of the business will also contribute to the amount of decrease a business experiences.