New York regulators have approved an average 9.1 percent hike in loss costs used by insurers, which is less than the 10.4 percent increase sought by the industry.
The New York State Insurance Department approved the increase to be effective on Oct. 1, 2011.
The increase follows a 7.7 percent increase approved last year.
The department held a public hearing on the industry’s loss cost filing on June 23. The filing was made for insurers by the New York Compensation Insurance Rating Board (NYCIRB) using data from policy years 2008 and 2009.
At that hearing, NYCIRB actuaries told officials that loss experience in the state is deteriorating, producing a pure loss ratio at 95.8 percent. The industry said claim frequency continues to decline but at a lower rate than in previous years.
The state is implementing changes in the maximum weekly benefits starting this year, as well as modifications to several medical fee schedules. The increases in the maximum weekly benefits are expected to result in a 1.4 percent increase in the total workers’ compensation claim costs, according to NYCIRB.
Last year, the state approved an average increase of 7.7 percent in loss costs effective Oct. 1, 2010, which is what the industry requested.