Copyright 2009 A.M. Best Company, Inc.All Rights Reserved BestWire

February 17, 2009 Tuesday 03:40 PM EST

325 words


Nevada Approves Workers' Comp Rate Cuts

Sean P Carr

CARSON CITY, Nev.

Nevada Insurance Commissioner Scott Kipper accepted an industry group's recommendations and ordered reductions in workers' compensation rates, effective March 1.

Citing decreasing claims frequency, the National Council on Compensation Insurance earlier this year proposed average decreases of 4.9% for Nevada workers' compensation voluntary insurance loss costs and 6% for insurance assigned risk rates in the state (BestWire, Jan. 29, 2009). As ordered by Kipper, the changes will vary by classification and will be as much as 20% above or below the average for industry groups, the state Division of Insurance announced.

By industry group, the changes will be: contracting, -5.5% voluntary, -6.6% assigned; goods and services, -5.6%, -6.7%; manufacturing, -9.1%, -10.1%; office and clerical, -2.8%, -3.9%; miscellaneous, -1.5%; -2.6%.

The rate reduction order also includes an experience rating that will reduce the decrease by 0.3% for both voluntary premiums and assigned risk premiums. Experience ratings, which apply to all but the smallest or newest employers, are used to encourage employers to engage in safe workplace practices, according to the insurance division.

Decreasing claim frequency more than offsets increasing indemnity and medical costs per claim, the cost of living benefit adjustments that were enacted during the 2003 Legislative session and the impact of the payroll cap, Kipper said in a statement. NCCI loss costs are one component of the rates charged by insurers and each insurer must file a loss cost multiplier to include expenses and profit.

In 2007, the top five writers of workers' compensation insurance in Nevada, according to A.M. Best Co. state/line data, were: American International Group Inc., with 22.6% market share; Employers Insurance Group, 11.2%; Liberty Mutual Insurance Co., 7.8%; Nevada Contractors Group, 7%; and Travelers Group, 5%.

(By Sean P. Carr, senior associate editor, BestWeek: Sean.Carr@ambest.com)

February 19, 2009

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