FRANKFORT, Ky. (Aug. 27, 2012) – An annual filing most insurance carriers will use to develop rates for workers compensation coverage shows the seventh consecutive overall decrease in loss costs, Department of Insurance Commissioner Sharon P. Clark announced today.
The 2012 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.
Data collected from insurance carriers is used to develop loss costs, which are 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 compensation 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 7.9 percent for the 590 industrial classes used in Kentucky. These classes include manufacturing, office and clerical, contracting, and goods and services. For coal classes, underground mining costs decreased 8.9 percent and surface mining decreased 7 percent.
“These seven consecutive decreases have lowered the loss costs on average 42.2 percent in Kentucky. This is more good news for Kentucky employers and workers,” said Clark. “The overall picture continues to be quite positive.”