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Dec. 3, 2007

Washington’s workers’ comp rates will increase 3.2 percent

TUMWATER — The Department of Labor & Industries (L&I) today formally adopted 2008 workers’ compensation rates that were proposed in September, increasing premiums by an average of 3.2 percent next year.

L&I has published online the new 2008 rates by industry and will notify individual employers of their specific rates in mid-December.

L&I Director Judy Schurke said the increase is necessary to partially cover wage and health care inflation. L&I held statewide public hearings on the increase in October and November.

The increase, which will bring in an additional $58 million in premiums next year, is an average for all Washington employers. Individual employers could see their rates go up or down, depending on their recent claims history and any changes in the frequency and cost of claims in their industry.

The rate increase follows a 2 percent decrease in average premiums this year and a current partial rate holiday in the second half of 2007 that is saving employers and workers $315 million.

Washington’s workers’ compensation system is made up of three funds that provide benefits when workers are hurt on the job.

The Accident Fund rate will decrease by an average of 4.5 percent in 2008. Employers pay premiums into this fund. The Medical Aid Fund rate will rise by an average of 10.5 percent, and the Supplemental Pension Fund rate will go up 17.1 percent. Employers and workers contribute equal premiums for the latter two funds.

L&I also will fully implement a change in the “Experience Modification Factor,” which is used to determine an employer’s rates. A year ago, the Department adopted the new formula but delayed any cost increase for a year to give employers time to adjust to the change.

L&I runs the state’s workers’ compensation system, which currently provides industrial insurance coverage to about 2.5 million workers and 168,000 employers. That represents about two-thirds of the state’s workforce. The rest are employed by companies or agencies that self-insure. 

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For media information: Robert Nelson, L&I Public Affairs, at 360-902-6043.

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