Colorado employers face another increase in workers’ compensation insurance premiums.
The Colorado Division of Insurance announced that the “loss costs” component of premiums will increase 5.2 percent in 2013.
Loss costs take into account the average cost of lost wages and medical payments of workers injured on the job. Loss costs are one factor used in establishing workers’ compensation insurance premiums for each employer.
The 2013 increase will mark the third straight year of higher loss costs in Colorado. Before that, loss costs had not increased in more than a decade.
“The trends of the last few years continued: increasing claim costs and increasing frequency of claims,” said Pat Knepler, the lead staff member of the division on the issue. “However, Colorado employers and employees continue to improve safety and reduce losses. Without those efforts, it is likely the increase would be higher.”
The National Council on Compensation Insurance determines loss costs based on annual data on workers’ compensation claims. Colorado insurers use NCCI loss costs as a base and then add their own expenses to determine the rates they charge employers.