Next year, Missouri Workers Compensation Rates will enjoy the 6th consecutive year of continuing declines
During the first week of December, The Missouri Department of Commerce and Insurance recommended a 1.6 percent decrease for workers compensation pure premium rates in 2020. If approved, the new rates will go in to effect starting January 1st. The decrease is driven by declining lost-time claim frequencies. Unfortunately, the increasing average medical claim costs partially limited the decrease in Missouri Workers Compensation Rates in 2020.
Missouri Workers Comp in 2019 experienced another modest 3.5 percent decrease for workers compensation insurance loss costs. These decreases mark the 6th consecutive year of continuing declines for workers comp pure premium rates. According to Chlora Lindley-Myers, Director of the Department of Commerce and Insurance, “Missouri’s lost-time claim frequency continues to decrease due to safety improvements in the workplace, but average medical claim costs have increased every year since 2014.” This statement means businesses have had employees lose less time due to insurance claims. The less time by injured employees means insurance carriers did not have to payout as much for workers compensaiton claims. This allows the insurance carriers offering workers comp coverage in the state of Missouri to pass on some of the savings on to the business community in the form of lower workers compensation insurance rates in 2019.
An additional factor that contributes to modest declines in workers comp premium is that Missouri is an NCCI state. NCCI stands for the National Council on Compensation Insurance. The main function of NCCI is to collect data, analyze trends, and recommended pure premium rates. States that partner with NCCI, for the most part, enjoy lower rates on workers compensation premium.
Both the NCCI and the department propose an overall loss cost decrease of 1.6 percent for policies effective Jan. 1, 2020.
The NCCI’s proposed average changes in loss costs by industry group are shown below:
- Manufacturing: -0.7%
Office and Clerical: -1.6%
Goods and Services: -1.9%