Commercial workers' compensation premiums for Missouri businesses dropped an average of almost 10 percent in 1998, according to information from the Missouri Department of Insurance. The department said the decreases resulted in savings of more than $51 million for state employers.
"Missouri businesses still are reaping the financial benefits of 1993's landmark workers' compensation reforms, which relied on market competition and increased safety to end several years of double-digit rate increases," said A.W. McPherson, acting director of the Missouri Department of Insurance.
In that year, a package of workers' comp laws were in enacted that included deregulation of rates for policies sold in the regular commercial market. Previously, the department set workers' compensation rates for all insurers. In the early 1990s, a department release said, rate increases averaged 15 percent a year.
Through the end of 1998, insurance company reports showed overall rates dropped a total of at least 19.9 percent since deregulation took effect in 1994.
Of 307 workers' compensation insurers operating in Missouri, 267 now charge average rates lower than when rates were deregulated.
In 1998 221 insurers filed rate reductions that averaged 15.3 percent, representing about 76 percent of the Missouri workers' compensation market. Three insurers filed increases and the remainder stayed the same.
Overall, there was a 9.8 percent reduction in premiums in 1998.
Since 1994 when deregulation took effect, 56 new insurers have begun selling policies in Missouri, 17 of them starting in 1998.
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