High WorkComp Insurance Rates Impact More Than Just California Written by Mark Kraemer on 3/22/2017 2:57 AM in Work Comp Insurance, Work Comp Seminar, Mark Kraemer. It has 0 Comments. Findings in a recent report on workman's compensation insurance premiums in the Golden State show premiums continue to grow at double-digit rates. And California isn’t the only state where businesses are being hit hard by increases. Mixed News The report looked at developing trends in the wake of the state’s massive work comp reforms, including the impact of California Senate Bill 863. Though only 12% of the workforce, the state’s workers’ comp written premium adds up to more than a quarter of the nationwide total. The positive news: Rates aren’t much higher than they were nearly 40 years ago, and less than half what they were before 2003 reforms; The ugly: They’re on the rise. Why So High? Similar to the rest of the country, California’s rising premiums are a result of higher premium rates and growth in insured payroll resulting from economic growth and wage increases. What puts California at the top? The state has the highest frequency of permanent disability claims, and among the highest medical and benefits delivery costs. Higher treatment costs resulting from prolonged treatment and a rate of permanent disability claims more than twice the national median also did not help matters. An aberration in the claims frequencies in L.A. is driving the trend. Nix L.A. – and California would be similar to the rest of the country. SB 863 Also Mixed Bag Intended to reduce litigation costs, SB 863 has been somewhat thwarted by expedited hearings and increased Independent Medical Reviews, with medical cost savings (greater-than-projected), offset by losses to frictional costs. Workman's compensation insurance rates getting painful? Minnesota Comp Advisor can help. Contact us today.