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Workers' Compensation Rate Changes

October 20, 2006

This week, Florida Insurance Commissioner, Kevin McCarty, rejected a request by NCCI to lower workers’ compensation rates paid by Florida employers by 13%. The good news is that McCarty believes that the rates should be even lower. He is asking for a reduction of 15.7% which would save Florida employers $400 million. This would be the fourth decrease in rates for the business community since AIF spearheaded the effort to lower rates through a bill passed in the Florida Legislature in the 2003 session.
See the full notice from the OIR below.


TALLAHASSEE (10/17/2006) – Florida Insurance Commissioner Kevin McCarty today disapproved the recent rate filing submitted by the National Council on Compensation Insurance (NCCI). NCCI’s filing called for a statewide average rate decrease in workers’ compensation insurance rates of 13.3 percent, which was primarily due to a significant drop in claims frequency and a reduction in the cost of claims.

McCarty has ordered NCCI to amend its filing to bring about a rate reduction of 15.7 percent. McCarty cited disagreements with the methodology NCCI used to project losses and with the trend factors used in the filing. Trend factors incorporate changes in wages, paid losses, and claims frequency.

The overall average rate decrease of 15.7 percent would produce a savings of over $400 million for Florida employers, and would constitute the fourth consecutive drop since Gov. Bush and the Legislature passed sweeping reforms to the state’s workers’ compensation system in 2003. The cumulative overall statewide average rate decrease for the period would total over 40 percent.

“This will provide a significant boost to Florida businesses and to our state’s economy,” said McCarty. “Not only has the 2003 law produced hundreds of millions of dollars in reduced premiums, it is also delivering benefits to employees more efficiently and fairly and has sharply reduced fraud and abuse in the system.”

A rate hearing on the filing was held by the Office of Insurance Regulation on October 9, 2006. Prior to the 2003 reforms, Florida’s workers’ compensation system was weighed down with high liability coverage costs for employers and few benefits for injured employees. Workers’ compensation rate changes in Florida following the reforms were:

NCCI Proposed Change
OIR Approved Change


A copy of the NCCI order can be found at: