Insurance Association Pushes for S.C. Workers’ Comp Reform

April 27, 2007

With claim costs continuing to rise in South Carolina, the National Council on Compensation Insurance (NCCI) is recommending that the workers compensation loss cost level be increased by 23.7 percent.

“This news highlights the need to reform the state’s workers compensation system,” said Robert Herlong, vice president and regional manager for the Property Casualty Insurers Association of America. “High litigation, medical cost increases and other cost drivers in the system make it difficult for insurers to hold the line on premiums and that is hard on small businesses. The current environment hurts wages, job growth and economic development. We have reached a crisis situation that requires the Legislature to enact significant reform.”

The NCCI submits an advisory loss cost proposal to the insurance department for approval. Last year NCCI recommended a 33 percent increase that was rejected by the insurance department and ultimately reduced to an 18.4 percent increase by an administrative law judge.

“As costs continue to increase, the problems within the workers compensation system only become worse,” said Herlong. “PCI is urging the Legislature to enact comprehensive reform of the system including repeal of the Second Injury Fund. Additionally, there are several legal rulings that have contributed to increased costs that must be repealed. We also need to have strict enforcement of anti-fraud measures and greater consistency regarding the benefit awards issued through the workers compensation commission. Together these actions will help bring South Carolina’s workers compensation rates more in line with neighboring states.”

Source: Property Casualty Insurers Association of America

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