Workers’ Comp Rates to go Down in FL, According to NCCI


By Liz Carey

Tallahassee, FL ( – Rates for workers’ compensation insurance will go down by 9.3 percent in Florida for 2018, according to a report issued today by the National Council on Compensation Insurance (NCCI).

After recommending an increase of 19.6 percent last year, the organization recommended the decrease this year based on different data. In 2016, two separate decisions in the Florida Supreme Court struck down some elements of the state’s workers’ compensation law. The increase was based on those court decisions — Bradley Westphal v. City of St. Petersburg and Marvin Castellanos v. Next Door Co. et al.

But the Florida Office of Insurance Regulation (OIR) only approved a 14.5 percent increase that took effect last December.

Those changes were made based on the court decisions, NCCI said.

But on Monday, in a letter sent to David Altmaier, Commissioner of the Florida Office of Insurance Regulation, NCCI said the rate for 2018 would decrease an average of 9.3 percent for industrial classifications, and an average of 10.9 percent for federal classifications.

The filing is an experience-based filing, and is based on financial data premiums and losses from policy years 2014 and 2015, evaluated as of December 31, 2016.

According to the report, the use of 2014 and 2015 data was “selected as most appropriate in terms of providing balance between stability and responsiveness.”

But Judge David Langham, Deputy Chief Judge of Compensation Claims for the Florida Office of Judges of Compensation Claims at the Division of Administrative Hearings, wondered how the new rates would impact businesses.

“This suggests that the filing is based upon information that is two years old. By doing so, they are basing their findings on information that pre-dates the Castellanos decision,” Langham said. “There is a potential for insurance companies to have higher than expected losses with premiums that are lower than expected.”

“Many people are saying that last year’s legal filing of 19 percent is dead wrong and this year’s filing proves it, but I don’t believe that,” Judge Langham said. “I’m being told that NCCI is basing its rates on 2- year-old data… In 2017, with all the changes that have been made, why not use newer data?” 

NCCI said last year’s increase looked at the impact of the court cases in making its recommendation.

“Last year, two separate Florida Supreme Court decisions resulted in changes to the Florida workers’ compensation landscape,” NCCI said in a statement. “Those cases, Castellanos v. Next Door Company, et al. (April 28, 2016) and Westphal v. City of St. Petersburg, et al. (June 9, 2016) brought about retroactive changes to claimant attorney fee and benefit levels. NCCI submitted a filing which addressed the projected impact of the two court decisions including future upward pressure on claim costs as well as a growing unfunded liability on open claims.”

This year’s reduction, the organization said, was based on decreases in claims, as well as decreases in expenses.

“The proposed reduction represents a continued improvement in claim frequency, more than an 8% decrease in Florida over the last two years, and is the primary driver of the decrease filed with the OIR,” the company said in its statement. “In addition to the improvements in loss experience, the filing includes a 1.9% decrease in expense provisions, including a proposed decrease to the Profit & Contingency provision from 2.75% to 2.0%. Florida is a ‘full rate’ jurisdiction which means that the filing includes all components within the rate charged to the policyholder (i.e. general expenses, taxes, profit and contingency, commissions, etc.).”

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