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Loss costs show continued good news for Kentucky employers
Frankfort, KY (CompNewsNetwork) - A 2008 filing most insurance carriers will use to
develop rates for workers' compensation coverage shows the third straight decrease in loss
costs, Department of Insurance Commissioner Sharon P. Clark announced
today.
The filing, approved by the state Department of
Insurance and effective Oct. 1, is by the National Council on Compensation Insurance Inc.
(NCCI), an advisory organization that serves as the oldest provider of workers'
compensation and employee injury data and statistics in the nation.
“As businesses face tough economic times, this is a welcome piece of news,” said Clark.
“Workers' compensation insurance is a large cost of doing business. This also is good news
for hardworking Kentuckians since the report shows a continuing decline in the number of
workplace injuries and a slight decline in the severity of those
claims.”
Data collected from insurance carriers is used to
develop loss costs, which is the average compensation for lost wages, based on the level of
disability, plus medical benefit payments. Use of the information is voluntary but most
workers' comp carriers use the NCCI loss cost values as a base to which the insurer's own
loss adjustment and overhead expenses are added to arrive at the rates charged to Kentucky
employers.
The loss cost figures show an average reduction
of 5.1 percent for the 596 industrial classes used in Kentucky. These classes include
manufacturing, office and clerical, contracting, and goods and services. For coal classes,
underground mining costs dropped 10.5 percent while surface mining decreased 8.7
percent.
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