Washington L&I: Reforms Create Opportunity to Restore Workers' Comp Reserves

"It's critical that we restore the workers' comp reserves. Savings from the reforms create an opportunity to do this without large rate increases," said L&I Director Judy Schurke.

The Washington Department of Labor & Industries (L&I) recently asked the Washington Workers' Compensation Advisory Committee (WCAC), made up of business and labor stakeholders, for input on restoring the workers' compensation reserve funds that have been drawn down over the past three years.

"The reforms passed by the Legislature earlier this year allow us to put the reserve funds back on a sustainable path for the future," said L&I Director Judy Schurke.

The reforms will save $1.1 billion over the next four years. As a result of these savings, the indicated or "break-even" rate for 2012 for workers' comp premiums is a negative 0.3 percent. Without the reforms, the break-even rate for 2012 would have been an 8.1 percent increase.

L&I drew down its contingency reserves by $332 million over the last three years to hold down rate increases for employers and workers during the recession. At a Sept. 12 meeting, L&I actuaries told WCAC that Washington state's current reserves are low by industry standards. For every dollar held in reserves by other public industrial insurers, Washington has 20 cents in reserve.

"It's critical that we restore the workers' comp reserves. Savings from the reforms create an opportunity to do this without large rate increases," Schurke noted.

WCAC was asked to comment on a rate increase for 2012 ranging from 4.5 to 8 percent. Taking a higher rate increase in 2012 will restore the reserves faster and lead to lower rate increases in the future.

After hearing from WCAC and other stakeholders, the agency will announce the proposed rates for 2012 on Sept. 20. Public hearings will be held in October and the final rates will be announced in early December.

"We know the economic climate is still precarious. The workers' comp system is also impacted by economic conditions over which we have little control, such as inflation and lower yields on investments," Schurke said. "That's why we are asking for input on how fast to restore the workers' comp reserve funds."

Download Center

HTML - No Current Item Deck
  • Free Safety Management Software Demo

    IndustrySafe Safety Management Software helps organizations to improve safety by providing a comprehensive toolset of software modules to help businesses identify trouble spots; reduce claims, lost days, OSHA fines; and more.

  • Get the Ultimate Guide to OSHA Recordkeeping

    When it comes to OSHA recordkeeping there are always questions regarding the requirements and in and outs. IndustrySafe is here to help. We put together this page with critical information to help answer your key questions about OSHA recordkeeping.

  • Safety Training 101

    When it comes to safety training, no matter the industry, there are always questions regarding requirements and certifications. We put together a guide that’s easy to digest so you can ensure you're complying with OSHA's training standards.

  • Conduct EHS Inspections and Audits

    Record and manage your organization’s inspection data with IndustrySafe’s Inspections module. IndustrySafe’s pre-built forms and checklists may be used as is, or can be customized to better suit the needs of your organization.

  • Track Key Safety Performance Indicators

    IndustrySafe’s Dashboard Module allows organizations to easily track safety KPIs and metrics. Gain increased visibility into your business’ operations and safety data.

  • Industry Safe
comments powered by Disqus