Massachusetts businesses are poised to save about $130 million in workers’ compensation insurance premiums starting July 1 after the state announced it reached a settlement with the Workers’ Compensation Rating and Inspection Bureau and the State Rating Bureau.
The settlement, announced Wednesday by Massachusetts Attorney General Andrea Joy Campbell, resolves an administrative review at the Division of Insurance and is expected to result in a 10.2% rollback of insurance rates for small businesses and other employers.
“By lowering workers’ compensation insurance rates, we can help better protect workers and ensure that small businesses can offer higher wages, better benefits and lower prices,”; Campbell said in a statement.
Employment insurance is mandatory for all employers in Massachusetts. Rates are set at least every two years during administrative rate reviews before the state insurance commissioner, and the attorney general’s office tries the cases to ensure fair rates for policyholders, according to Ms. Campbell.
Campbell said her office stepped in this winter after data filed by the state’s insurers suggested a rate cut of about 4%.
The attorney general said she identified flaws in the industry’s forecasts and argued for a larger reduction, ultimately resulting in the 10.2% average reset announced this week.
Ms. Campbell said her office this winter managed to get an order to review the projected reductions earlier than the typical two-year cycle.
The attorney general’s office said over the past five years it has saved employers hundreds of millions of dollars by intervening in insurance administrative rate cases.