New York State
July 16, 1999
DEPARTMENT ANNOUNCES THAT WORKERS COMPENSATION
RATES WILL REMAIN UNCHANGED
Rejects Rating Boards Request for a Rate Hike
Continuing the trend of stable rates for workers compensation in New York State, Superintendent Neil D. Levin today announced that workers compensation rates will remain unchanged, rejecting the New York Compensation Insurance Rating Boards (NYCIRB) request for a 12.6 percent insurance rate hike.
"We are rejecting the rating boards request because the increase is excessive," said Levin. "The review of the rating board submission and the testimony received in a public hearing shows us there is still adequacy in the rate structure. In fact, there has not been a full integration of the reforms championed by Governor Pataki in 1996 into the rates. My decision today challenges the industry to fully value those improvements."
Pataki has proposed sweeping workers compensation reforms that will spur job growth by reducing rates paid by employers an average 24.3 percent saving employers a total of $631.8 million. These reforms are part of the administrations broader initiative to turn New Yorks economy around. In 1996, Pataki enacted reforms that have created approximately 459,000 private sector jobs and resulted in the largest reduction in workers comp costs in state history. Levin noted that testimony received at the July 1 hearing indicated that these new reforms will cut costs by an additional 20 percent.
"We look forward to avoiding the threat of rate increases in coming years, renewing the call for the Legislature to swiftly pass the Governors workers compensation reforms," said Levin. "These reforms are necessary because they will go a long way in cutting rates and protecting injured workers."
Rates have been declining for workers compensation coverage for the past few years, demonstrating that Patakis reforms are working. Last year, the rates dropped by 6 percent the third time since the 1996 reforms were implemented. That decrease followed reductions of 8.4 percent and 18.0 percent in 1997 and 1996, respectively.
The Department held a public hearing July 1 to consider the application of the NYCIRB for a workers compensation insurance increase of 12.6 percent. All workers compensation insurers must send statistics to the NYCIRB, which compiles and evaluates data and proposes rate changes that are subject to the Departments prior approval.