The California Workers’ Compensation Insurance Rating Bureau (WCIRB: an independent entity that develops the statistics used in rate making) recommends a 16% increase in workers’ compensation insurance premiums for January 2009. [https://wcirbonline.org/wcirb/wcirb_wire/2008/2008_07.html] After several years of significant decreases due to workers’ compensation reforms, premiums are on the rise again. What actions can employers and small business owners take to keep premiums within reason?
1.) Participate in rate hearings. These hearings are typically held in the Fall to address rate changes going into effect the following January. The California Insurance Commissioner must hold public hearings to permit industry and individual challenges to proposed recommended pure premium rates, including any changes to rates set for individual classifications applicable to specific job categories (i.e. rates are highest for roofers and lowest for office workers based on the statistical risk of injury). To challenge such changes in rates, employers and industry representatives appear to make statements for the Insurance Commissioner to consider in addition to the statistical information provided by the WCIRB. If you want to make a public comment, here are some suggestions: a.) do the math- the most influential comments are backed up with statistical evidence; b.) consider hiring an attorney or representative to pitch your case both in writing and orally at the hearing; and c.) coordinate with other interested parties.
2.) File a complaint with the WCIRB and/or your insurer; if your complaint is denied file an appeal with the Department of Insurance Administrative Hearing Bureau (DOI AHB) regarding issues with the calculation of your premium. Although the AHB does not handle disputes over pure premium rates, it does handle disputes regarding the proper classification of employees, or other factors going into actual premium calculations. If going this route, consider hiring counsel. Technical issues of jurisdiction and timeliness derail too many of these appeals. Although the hearings are informal and counsel is not required, insurers are almost always represented by counsel and they typically win, perhaps because of their use of counsel. Whether you hire counsel or not, be sure to come prepared with witnesses and statistics to back up your claim.
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