July 17, 2014

The request to increase the loss cost level by 6.8% filed by The New York Compensation Insurance Rating Board (NYCIRB) effective October 1^st has been disapproved by the New York Department of Financial Services (DFS). Consequently, the current loss costs and rating values will remain in effect. As experts in workers compensation premium recovery, Apex Services breaks down what this all means for brokers and their clients.

Although loss cost rates will remain the same for the time being, brokers can expect their clients’ premiums to continue to increase.

Several reasons led to The DFS’s decision to disapprove of NYCIRB’s request. Among them are:

• The DFS disagreed with the NYCIRB’s permanent partial disability (PPD) duration cap loss assumptions and the Reopened Case Fund (RCF) closure assumptions.
• The DFS disagreed with NYCIRB’s methodology of using private carriers’ premium development factors based on the latest three years, as opposed to the latest two years that had been using in prior filings.
• The DFS claims that carriers will see “meaningful savings” after reforms to the Workers’ Compensation Board (WCB). These include reforms to guidelines on various types of injuries, to reduce dependence on opioids, use of generic drugs, and limit to the number of injections that may be administered to “trigger points.”

Despite all this, the DFS noted that carriers will still have the option to file revised loss cost multipliers with the DFS. So the bottom line is that rates will be raised one way or the other.  Since DFS won’t allow rate increases suggested by NYCIRB, the carriers will file revised loss cost multipliers upward with the DFS. Employers, especially those with bad experience modification factors, will pay higher premiums. As far as all the supposed claim changes go, we’re still waiting to see if the big Spitzer changes make a significant impact. Losses will continue to rise for some and decrease for others.

Workers Compensation Premium Recovery offers brokers the quickest and easiest way to help their clients lower their experience mods, obtain workers compensation refunds and lower their premiums while solidifying their client relationships.  Brokers can get to a whole new level with prospects when they work with us to secure workers compensation refunds for them!