Nevada Insurance Commissioner Alice Molasky-Arman announced that the National Council on Compensation Insurance (NCCI) has submitted a filing for an average decrease of 6.5 percent for workers’ compensation voluntary insurance loss costs in Nevada.
The NCCI has also filed for an average decrease of 1.9 percent for workers’ comp insurance assigned risk rates. The changes are proposed to be effective Jan. 1, 2005.
Molasky-Arman said, “I am encouraged by the downward trend in workers’ compensation rates and the impact of this trend on the economic well being of the state of Nevada. The decreased rates are an indication of the success and profitability of the private insurance market since converting on July 1, 1999 from a monopolistic market.”
If approved, most employers should benefit from basic rate reductions in their workers’ comp premiums, although some could face rate increases of up to 20 percent in the voluntary market and up to 24 percent in the assigned risk market. The new rates would apply to each employer on its normal anniversary rating date. This is the second year that workers’ comp loss costs have declined. Last year, rates were decreased 12.3% in the voluntary loss costs and 15.6% in the assigned risk rates.
In contrast to other nearby jurisdictions where the workers’ comp rates are flat or increasing, Nevada businesses are reportedly benefiting from falling rates. Since workers’ comp represents a significant cost to employers, Molasky-Arman is optimistic the reduced costs will encourage more businesses to locate in Nevada.
It should be noted that the NCCI loss costs are only one component of the rates charged by insurers, and each insurer must file a loss cost multiplier to include expenses and profit. As a result, not every insurer charges the same rate.
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