NCCI reduces loss cost rate again for Oklahoma
Oklahoma’s workers’ compensation insurance rates could decline again in 2019 after the National Council
on Compensation Insurance (NCCI) proposed an overall loss cost decrease of 2.3 percent in a filing that
many insurers use to develop prices, Insurance Commissioner John Doak said.
“This is great news for Oklahoma,” said Doak. “When employers pay less for workers’ compensation
insurance, they’re able to grow their businesses, hire more workers and expand the economy.
Oklahoma’s commitment to a system that’s both efficient and fair has been tremendously successful on
multiple levels.”
The new loss costs will go through a review process and are expected to go into effect Jan. 1. NCCI files
loss costs annually with the Oklahoma Insurance Department and files supplemental amendments, when
needed, to address significant changes in expectations such as court decisions.
NCCI credits the reduced loss cost to favorable experience across all industry groups.
“The current decrease, following decreases of 16 percent and 10 percent, puts to rest any prior
skepticism and confirms that the decreases in prior years were warranted,” said Dr. Mark Crawshaw,
president of Madison Consulting Group Inc., who performs an actuarial review of the filing.
Workers’ Compensation Commission Chair Mark Liotta recently told the Advisory Council on Workers
Compensation and the commission’s Physicians Advisory Committee that workers’ compensation
insurance premiums have 31.6 percent since 2013. That was when lawmakers passed and Gov. Mary
Fallin signed Senate Bill 1068. It created the Administrative Workers’ Compensation Act. It repealed much
of the existing Workers Compensation statute (Title 85) and created a new Title 85A establishing an
administrative workers’ compensation system. The new system began accepting case filings in February,
2014.
In 2013, the premiums totaled $961.5 million; that amount was $656.9 million in 2017, Liotta said. Liotta
noted during his presentations that the state’s overall loss cost – that portion of premiums used to cover
claims and their adjustment costs – was declining faster than in other state, according to a study, likely
setting the stage for further premium reductions.
“This reduction reflects the continuing positive effects of the workers’ compensation reform passed by the
Legislature and signed by Gov. Fallin in 2013”, said State Chamber of Oklahoma President and Chief
Executive Officer Fred Morgan. “Another year of reducing the loss cost filing is a great sign for business
in Oklahoma and the latest decrease will bring the total loss costs rate reduction to nearly 64 percent.”
The State Chamber was one of the major proponents of the reform efforts.
The 2019 filing will be discussed in detail at two Oklahoma Insurance Department State Advisory Forums.
The Tulsa forum will be held on Oct. 9. The Oklahoma City forum will take place on Oct. 10.