Insurance and risk management professionals who are monitoring the coming change to the workers’ compensation experience rating process will be interested in these brief pieces of news related to the 2013 split point change:
First of all, NCCI has a new 24-minute webinar, Understanding NCCI’s Filed Experience Rating Plan Changes – Item E-1402. This webinar includes:
- What has prompted the change to the primary-excess split point.
- What potential impacts to the mod can be expected.
- Most helpfully, several hypothetical examples are discussed. Especially notable in this section is how employer size and the relationship of class severity to discount ratio may affect the mod in conjunction with the new split point.
A majority of states have already approved the split point change to take effect with their 2013 loss cost or rate filing, but what of the independent bureaus?
New York is on track for a split point change to $10,000 effective 10/1/2013.
The New York Compensation Insurance Rating Board (NYCIRB) says in its NYCIRB Annual Report 2011 (pdf):
…the [Actuarial] Committee approved an increase in the split point from the current $5,000 to at least $15,000 in several steps, with the first step to be set at $10,000 effective October 1, 2013. Further research was recommended to determine appropriate split points subsequent to that date.
Wisconsin has the split point change under consideration, but not yet approved.
In September 2011, Circular Letter 1137 from the Wisconsin Compensation Rating Bureau (WCRB) says:
The [Wisconsin Governing] Board adopted the recommendation of the Rating Committee to adopt this proposal [item E-1402] effective with the 10-1-13 rate revision.
However, in December 2011, Circular Letter 1139 (pdf) states that
This item [E-1402] was disapproved by the OCI [Office of the Commissioner of Insurance]. WCRB will respond to the items of concern and request reconsideration of the disapproval.
Other independent states which use similar rating methodology but do not use NCCI for
interstate intrastate mods are Michigan, Minnesota, and Texas. If those states have a split point change under consideration or approved, I’ve not yet seen such information. If you’re in those states and have heard any news regarding the split point, I know our readers would love for you to share via a comment!
- Kory Wells, WorkCompEdge Blog Editor
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