In responding to information released by the Workers’ Compensation Insurance Rating Bureau of California is being mischaracterized as a $7 billion mistake, the following is a statement by Sam Sorich, president of the Association of California Insurance Companies (ACIC). Sorich said the characterization is not true.
According to Sorich, here are the facts:
· The Workers’ Compensation Insurance Rating Bureau estimated benefit costs at $17.9 billion for injured workers during 2004.
· The $17.9 billion estimate was made to reflect the most up-to-date analysis of the workers’ compensation reforms enacted by the Legislature last year. Prior to the reforms, the Rating Bureau had estimated the benefit costs would be $24.9 billion – or $7 billion more.
· Workers’ compensation insurance rates now being charged by insurers already take into account the cost reductions that were enacted in 2003.
· There is nothing in the Rating Bureau’s information that says that insurers are charging rates that are too high.
· The positive news from the Rating Bureau’s information is that last year’s reforms are working.
Sorich added that the Association of California Insurance Companies believes that the Legislature must take action to achieve further significant reform of the workers’ comp system.
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