Show-Me State workers’ comp rates expected to decline

Citing National Council on Compensation Insurance figures, Gov. Jay Nixon announced yesterday Missouri businesses can likely expect a decrease in workers’ compensation insurance rates next year.

Overall, preliminary figures collected by the Missouri Department of Insurance indicated the NCCI will propose an overall decrease of 2.4 percent from costs this year. The largest recommended decrease is in contracting - which includes construction - projected to decrease by 4.9 percent, according to a news release.

“Missouri’s workers’ comp loss costs continue to be lower than many of our neighboring states. Lower rates will help fuel Missouri’s continued economic growth,” Department of Insurance Director John Huff said in the release.

By industry group, the average decrease in loss costs proposed by the NCCI:
    •    contracting, 4.9 percent;
    •    goods and services, 2.5 percent;
    •    manufacturing, 2.3 percent;
    •    office and clerical, 0.9 percent; and
    •    miscellaneous, 0.5 percent.

Loss costs reflect the costs of workers’ comp claims and do not include the insurance company’s administrative costs, taxes, agent expenses, profits or overhead.  The workers’ comp market in Missouri is competitive, with 322 companies pursuing that business, according to the release.

After reviewing loss costs proposed by the NCCI, the Missouri Department of Insurance will recommend its own costs. Claims are regulated by the Missouri Department of Labor and Industrial Relations’ Division of Workers’ Compensation, and rates are reviewed by the Department of Insurance. Insurance companies use lost costs to establish workers’ comp premiums for Missouri employers.

“Skilled workers are safe workers, and safe workers help keep costs down for everyone,” Nixon said in the release. “I appreciate the skilled laborers throughout the state that have made work sites safer, helping to make Missouri a leader in lower worker compensation costs.”

According to the release, workers’ comp costs in Missouri are generally lower than Illinois, Iowa and Oklahoma.