April 22, 2025 | Oakland, CA – MedLegalNews.com — Workers compensation rates in California are set to rise, as the Workers’ Compensation Insurance Rating Bureau (WCIRB) Governing Committee authorized the September 1, 2025, Pure Premium Rate Filing to the California Insurance Commissioner.
The increase is based on insurer losses and loss adjustment expenses incurred during accident years 2024 and prior, valued as of December 31, 2024. In his presentation to the Governing Committee, WCIRB Executive Vice President and Chief Actuary Tony Milano highlighted that the rise in pure premium rates stems from a combination of factors, including higher medical loss development, an uptick in cumulative trauma claims, escalating average medical costs, and increasing allocated loss adjustment expenses.
What’s Driving the Increase?
Milano pointed out that the increase in proposed rates is primarily driven by:
- Medical Loss Development: The rising costs of medical treatment are adding to the financial burdens on insurers.
- Cumulative Trauma Claims: The frequency of these claims has increased, adding to the overall cost of workers’ compensation claims.
- Higher Medical Costs: Growing healthcare costs are pushing up the expenses associated with workers’ compensation claims.
- Allocated Loss Adjustment Expenses: These expenses are also on the rise, further contributing to the higher rates.
The WCIRB is expected to submit its filing to the California Department of Insurance (CDI) by the end of April. Following submission, the CDI will schedule a public hearing to consider the proposed rates. Once the Notice of Proposed Action and Public Hearing is issued, the WCIRB will make the details available on its website.
Why This Matters for Employers and Insurers
The proposed rate hike signals a shift in the workers’ compensation landscape, impacting both employers and insurers. Businesses may face higher premiums as a result, which could affect their overall financial planning. It is crucial for employers to stay informed about the filing process and prepare for potential cost increases in their workers’ compensation insurance.
Employers, insurance brokers, and risk managers should also pay close attention to the factors driving these increases, such as the higher medical and trauma claims, in order to mitigate future risk and adjust their strategies for employee safety and claims management.
Next Steps for Employers and Insurers
- Monitor Public Hearing: Keep track of the scheduled public hearing once the Notice of Proposed Action is issued.
- Evaluate Impact on Costs: Begin evaluating how the proposed rate hike could affect your business’s workers’ compensation premiums.
- Plan for Adjustments: Consider reviewing safety programs and injury prevention strategies to help reduce potential claims and mitigate cost increases.
For more details on the rate filing, the WCIRB’s Regulatory and Pure Premium Rate Filings page will provide the official documents once the hearing notice is posted.
Read more at CA WCIRB official website.
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FAQS: California Workers Compensation Rates
What are California workers compensation rates?
California workers compensation rates are the insurance premium levels set to cover employee injury claims, medical costs, and loss adjustment expenses, approved and filed through the WCIRB.
Why are California workers compensation rates rising in 2025?
Rates are increasing due to higher medical loss development, cumulative trauma claims, escalating medical costs, and rising allocated loss adjustment expenses.
How do proposed California workers compensation rates affect employers?
Employers may face higher premiums, requiring adjustments in financial planning, risk management strategies, and workplace safety programs to mitigate potential claims.
Where can employers find official California workers compensation rates filings?
Employers can access official filings, notices, and public hearing information on the CA WCIRB website.