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California Workers Comp Combined Ratio Increases

September 1, 2010
Related Topics: Workers' Compensation, Benefit Design and Communication, Compensation, Latest News

California workers’ compensation insurers’ combined ratios climbed during 2009 to the highest level since 2001, while average claims costs continued increasing, according to a quarterly report on insurer experience released Thursday, August 26.

The ultimate accident-year 2009 combined ratio is estimated to have reached 124 percent, the San Francisco-based Workers’ Compensation Insurance Rating Bureau of California said in its “Summary of March 31, 2010 Experience.” That is 14 percentage points higher than for 2008 and the highest level since 2001, when it declined to 143 percent from 184 percent in 1999.

The bureau also projected an ultimate accident-year loss ratio of 80 percent for 2009, which is about 9 points above 2008 and the highest accident-year loss ratio since 2002.

The calendar-year combined ratio for 2009 is 116 percent, which is 15 points higher than for 2008, it said.

The bureau estimated that the average cost, or severity, of a 2009 indemnity claim will reach $60,000, a 5 percent increase over 2008. That comes after three years of severity increasing at about 15 percent per year.

Meanwhile, average statewide insurer rate per $100 of payroll for policies written in 2010 is $2.47, or 5 percent above the average rate charged for 2009.

The report can be found online at  

Filed by Joanne Wojcik of Business Insurance, a sister publication of Workforce Management. To comment, e-mail


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