MA AGO Opposes $40 Million WC Insurance Rate Hike Proposal

                               Boston, MA (CompNewsNetwork) - The Attorney General Martha Coakley's Office announced its opposition to an insurance industry request to raise workers' compensation premiums by over 4% this year.  If accepted by the Commissioner of Insurance, the rate increase will cost small businesses and other employers more than $40 million in extra premiums.  Workers' Compensation insurance pays lost wages, compensation for permanent injuries, and reimbursement for injury related services caused by job-related injuries.  The insurance companies, through their trade group, the Workers' Compensation Rating and Inspection Bureau (WCRIB), must seek approval from the Commissioner of Insurance to raise rates.  The Attorney General has the statutory right to oppose such increases and intervene in an administrative rate hearing process to ensure a rigorous review of the rates.  The Attorney General's Office intends to intervene in the administrative rate process to oppose this proposal. 

“Businesses, particularly small businesses, are already struggling in these difficult economic times and cannot afford to overpay for insurance coverage,” said Attorney General Coakley. “We have serious concerns about the insurers' proposed rate hike and the additional strain that it would put on employers.  Businesses are mandated under state law to purchase workers' compensation insurance, and they deserve fair rates to ensure that they can comply without having to layoff additional workers.  Our office will intervene in the rate proceeding to protect the public interest and work to block these unnecessary increases.” 

Attorney General Coakley's Office has historically played a key role in keeping workers' compensation rates affordable and has saved customers tens of millions of dollars. In February 2008, WCRIB submitted a filing to the Division of Insurance seeking a 2.3% rate increase for companies purchasing workers' compensation insurance policies.  The Attorney General's Office intervened in the action, noting that average rates were too high and commenced litigation on behalf of Massachusetts insurance customers.  The insurers then agreed to settle the matter by reducing rates by 1%.  This resolution saved Massachusetts businesses $30 million.

In 2007, the Attorney General's Office litigated another workers' compensation industry rate request, and successfully obtained a 16.9% rate rollback for Massachusetts businesses. As a result, Massachusetts's businesses saved $169 million in workers' compensation insurance premiums.  

This matter is being handled by Attorney General Coakley's Insurance and Financial Services Division.  

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