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Pennsylvania’s 7.8% Workers’ Compensation Cut Takes Effect in April *Centurion Insurance AFS*

Feb 05, 2024 (0) comment , , , , , , , , ,



Pennsylvania workers’ compensation rates will be going down for employers beginning April 1.

Insurance Commissioner Mike Humphreys on January 23 approved an overall decrease in loss costs of -7.88%, more than doubling last year’s decrease of -3.33%. Humphreys approved the Pennsylvania Compensation Rating Bureau’s (PCRB)’s annual loss cost filing.

The primary driver of the downward trend is the continued decrease in claim frequency at -6.1%, closely mirroring last year’s -6.2% figure and maintaining a consistent descending trajectory over the past few years, according to PCRB.

PCRB said another factor contributing to the decrease is fewer large claims in the most recent policy years.

“While the economic impacts from the pandemic have caused some disruption, the Pennsylvania workers compensation system has fared well, and remains strong,” said Brent Otto, PCRB’s chief actuary, in announcing the commissioner’s approval of the filing.

The loss costs and related rating values will take effect on new and renewal policies effective April 1, 2024.

Workers’ compensation insurance costs in the state have been declining in the state by 54% decrease since 2013, according to PCRB. During this period, lost time claim frequency has plummeted by 42%.

The average payment per claim has dropped from about $1,500 in 2015 to around $1,100 in 2022. Additionally, prescription costs per claim are down 60% since 2015, while average units per prescription are down 25%. Opioid prescriptions have declined 75% since 2015.

This latest PCRB’s loss cost filing incorporates its recently approved experience rating plan update, the first in two decades, which also has an effective date of April 1. The updated experience rating plan is revenue neutral.

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Workers’ Compensation
Talent
Pennsylvania

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