Lt. Governor, Members of Workers’ Compensation Task Force Present Report for Governor and General Assembly

Dover, DE – On Thursday, May 15, 2014 at 1:00pm, Lt. Governor Matt Denn will host a press conference to present the Workers’ Compensation Task Force Report to the Governor and the General Assembly, submitted pursuant to House Bill 175, 147th General Assembly. He will be joined by members of the Task Force – including Senators Blevins and Hocker, Representatives Briggs-King and B. Short – and the Governor, who will all make remarks, along with Rich Heffron of the State Chamber and others.

BACKGROUND – Created by House Joint Resolution 3, the task force was established on January 30, 2013 by the General Assembly and Governor to address the 34% increase in average workers compensation rates over the prior two years. Those rate increases increased costs for Delaware businesses and made it harder for them to compete for bids with businesses from neighboring states. On May 13, 2013, the task force made their first set of recommendations to Governor Markell and the General Assembly to stop the large workers’ compensation rate increases that burden Delaware businesses. The General Assembly accepted the recommendations unanimously, including keeping the task force in existence through June 30, 2014, both so that it could consider some issues that it did not have time to discuss during the short time that it had to make recommendations, and so that it could monitor the impact of its recommendations and suggest stricter measures with respect to medical costs if necessary.

The task force stated in the 2013 report that if the reforms recommended in that report were not successful in controlling workers compensation premium increases, then the task force would recommend stricter measures to control premiums. The task force believes that the 11.4% to 14% increase in rates resulting from the last filing was an unacceptable result, and that rates need to be reduced.

The report to be issued on Thursday offers those stricter measures.

Thursday, May 15, 2014
1:00pm
Tatnall Building (next to Legislative Hall)
3rd Floor – Governor’s Press Room
150 Martin Luther King, Jr. Blvd. South
Dover, DE 19901


Delaware Insurance Commissioner Karen Weldin Stewart Announces Decision on DCRB Workers’ Compensation Rate Filing

Dover, DE-Delaware Insurance Commissioner Karen Weldin Stewart announces today that based on the agreement between the Delaware Department of Insurance, the Delaware Compensation Rating Bureau and the Ratepayer Advocate, she has approved the re-submission of the Delaware Compensation Rating Bureau (DCRB) workers’ compensation rate filing regarding the residual market rate and the voluntary market loss cost.

The annual filing was carefully reviewed and analyzed by the Delaware Insurance Department’s actuaries, as well as the Rate Payer Advocate’s actuary. The reports were posted on the Department’s website. The lower increases approved reflect a more appropriate balance in the cost of insurance premiums compared to the cost of the system. The Commissioner and the Rate Payer Advocate, along with their actuaries, concurred that the increases of 11.4% in residual market rates and 14% in voluntary market loss costs met the requirements in Delaware law that rates must not be inadequate, excessive, or unfairly discriminatory. The effective date of the increase is retroactive to December 1, 2013 for new and renewal business.

Commissioner Stewart stated “While three different actuaries have all concluded that an increase is indicated, I must weigh more than actuarial considerations in making my decision. The difficulties seen by Delaware employers as emphasized during the three public information sessions, the need for our economy to grow, and the rising costs faced by insurers must all be included in my final decision. This decision represents a savings of more than 45 million dollars to Delaware employers from the original submission. We encourage the DCRB and legislative leaders to continue to work toward a common goal of identifying and addressing the underlying cost drivers in Delaware’s workers’ compensation rates.” Stewart believes that continued momentum behind legislative reforms introduced in 2013 and those sought in 2014 to ensure that future rate requests are small will help to keep our economy strong and attract and retain businesses in Delaware. Stewart added “Unfortunately, a rate increase is necessary this year for worker’s compensation insurance in Delaware. My commitment to the consumer is unwavering; and I will continue to work with all parties to create further reform that we expect will result in a reduction in the overall cost drivers in the worker’s compensation system.”

For more information about the DCRB annual rate filings, visit the Delaware Department of Insurance website at www.delawareinsurance.gov.

Please see attached statement from the Rate Payer Advocate.
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Delaware Department of Insurance: “Protecting Delawareans through regulation and education while providing oversight of the insurance industry to best serve the public.”