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Workers’ Compensation

The Property & Casualty Section of the Division of Insurance handles such duties as reviewing and approving workers’ compensation policy rates, language, composition and format, as well as collecting quarterly and annual financial statements from private workers’ compensation insurers.

 

Changes in Voluntary Insurance Loss Costs and Assigned-Risk Market Rates, Effective March 1, 2019:

  

Commissioner Barbara D. Richardson has approved the annual workers' compensation voluntary loss-cost and assigned-risk rate filing from the National Council on Compensation Insurance ("NCCI"). Filing 80335, effective March 1, 2019, Provides for an overall decrease of 8.1% in the Nevada workers’ compensation voluntary-market loss-cost level and an overall decrease of 7.3% in the workers’ compensation assigned-risk rate level.

Impacts to each individual classification of business will vary based on that classification’s recent experience. The range of impacts would be between -29% and +15%. A sizable majority of classifications would receive decreases, often substantial decreases, as a result of this filing.

 

NCCI has indicated that the underlying phenomena driving the proposed decreases are being observed throughout the United States, not only in Nevada. For instance, claim frequency continues to decline countrywide due to improvements in automation and workplace safety. NCCI is proposing decreases in the 2019 loss costs in most states; the impacts in Nevada are approximately in the middle of the range of countrywide changes proposed by NCCI.

 

This filing includes the impacts of the recent annual update by the Division of Industrial Relations to the Actuarial Annuity Table for permanent partial disability (PPD) lump-sum payments. After the major revision to the discount-rate assumption in 2017, subsequent annual revisions are expected to be modest. In 2018, the discount rate was revised from a 3.08% annual rate to a 3.09% annual rate. NCCI estimates the loss-cost impact of this revision to be negligible (less than 0.05%).

The tables below illustrate by industry group the proposed average changes arising from this filing.

Voluntary Loss-Cost Change 


Industry Group

 Average Change Due to Filing 80335 

Contracting

-9.4%

Goods & Services

-8.7%

Manufacturing

-8.4%

Office & Clerical

-8.3%

Miscellaneous

-5.4%

Overall

-8.1%


Assigned-Risk Rate Change  


Industry Group

Average Change Due to Filing 80335

Contracting

-8.5%

Goods & Services

-7.8%

Manufacturing

-7.5%

Office & Clerical

-7.4%

Miscellaneous

-4.9%

Overall

-7.3%


The overall loss-cost decrease for the voluntary market is driven by the following main considerations:

-7.5% impact due to combined changes in loss experience and favorable changes in loss development, which suggest that the amount of reported workers’ compensation claims will not grow over time by as large a proportion as was previously anticipated. Material declines in claim frequency have continued throughout the country, including in Nevada.

+0.7% impact due to benefit changes. Of this increase, +0.5% is due to changes in the Medical Fee Schedule issued by the Division of Industrial Relations – which took effect on February 1, 2018. The remaining +0.2% impact is the result of the increases in the maximum weekly benefit amounts effective July 1, 2018. These modest increases to workers’ compensation benefits are similar in magnitude to the changes reflected in prior years’ filings. Therefore, it remains the case that benefit adequacy is not being eroded; rather, historical and estimated prospective loss experience is sufficiently favorable to justify decreases in the cost of workers’ compensation coverage for most classifications of employers.


-1.7% impact due to changes in trend assumptions, primarily a result of revising the projected annual indemnity loss-ratio trend from -3.0% to -4.0%. The projected annual medical loss-ratio trend would remain at -2.5%. NCCI is projecting continued decreases to the indemnity loss ratios in the future.

 
● +0.3% impact due to an increase in the provision for loss-adjustment expenses from 15.4% to 15.7% of losses.

For the assigned-risk market, in addition to the aforementioned -8.1% impact to loss costs, there is a partially offsetting impact of approximately +0.87% due to changes to assumptions pertaining to expenses on the assigned-risk market. Specifically, the Assigned-Risk Loss-Cost Multiplier, which establishes the multiplicative difference between the voluntary-market loss costs and the assigned-risk rates, is proposed to increase from 1.603 to 1.617. As explained by NCCI, due to the recent adoption of the revised Actuarial Annuity Table for permanent partial disability (PPD) lump-sum payments by the Division of Industrial Relations, the loss-adjustment expenses (LAE) on the voluntary market are slightly smaller as a percentage of losses, but this impact does not translate to the assigned-risk market. The increase differential between the voluntary and assigned-risk markets is thus actually the result of the voluntary-market proportion of LAE decreasing – and thus, if total loss costs of the voluntary market are proposed to decrease, the implication is that the resulting decrease for the assigned-risk rates would need to be slightly tempered.

Adoption of Revised Loss Costs: The revised loss costs must be adopted on their effective date and applied to all policies on or after the effective date.


Insurers need only file new loss-cost multiplier worksheets if they are changing their loss-cost multipliers. Otherwise, the current loss-cost multipliers will continue to apply.

Large Deductible Workers’ Compensation Program Filing Requirement: As outlined in Bulletin 00-003, insurers are required to file each risk written with a Large Deductible ($25,000 or greater). Form NDOI-1112 (Revised July, 2017), the Informational Filing for Large Deductible Workers’ Compensation, must be submitted to the Commissioner for acceptance within 60 days of issuing the applicable Large Deductible policy.

For information regarding self-insured associations and self-insured employers, please see the Division of Insurance’s Self-Insured Section.

For information regarding employer workers’ compensation coverage compliance, claims handling and complaints, please contact the Division of Industrial Relations.

To report workers’ compensation fraud, please contact the Attorney General’s Workers' Compensation Fraud Unit.

 

Workers’ Comp Resources

Forms and Bulletins

Rate Filings / Loss-Cost Expense Worksheet

Workers’ Compensation Issues: Bulletin 00-002

Workers’ Compensation Deductible Programs: Bulletin 00-003

Terrorism Coverage Cannot be Excluded From Nevada Workers’ Compensation Insurance Policies: Bulletin 03-002  

2019 NCCI Loss Costs and Assigned-Risk Rates

NCCI Circular: Approval of Voluntary Loss Costs and Rating Values and Assigned-Risk Rates to Be Effective March 1, 2019

Advisory Loss Costs and Rating Values Effective 3/1/2019

Assigned-Risk Rates and Rating Values Effective 3/1/2019

2018 NCCI Loss Costs and Assigned-Risk Rates

NCCI Circular: Approval of Voluntary Loss Costs and Assigned-Risk Rates Law-Only Filing Effective March 15, 2018

NCCI Circular: Approval of Voluntary Loss Costs, Assigned-Risk Rates, and Rating Values to Be Effective March 1, 2018

Advisory Loss Costs and Rating Values Effective 3/15/2018

Assigned-Risk Rates and Rating Values Effective 3/15/2018

Advisory Loss Costs and Rating Values Effective 3/1/2018  

Assigned-Risk Rates and Rating Values Effective 3/1/2018  

2017 NCCI Loss Costs and Assigned-Risk Rates

NCCI Circular: Approval of Voluntary Loss Costs and Rating Values and Assigned-Risk Rates to Be Effective March 1, 2017 

Advisory Loss Costs and Rating Values Effective 3/1/2017 

Assigned-Risk Rates and Rating Values Effective 3/1/2017 

2016 NCCI Loss Costs and Assigned-Risk Rates

NCCI Circular: Approval of Voluntary Loss Costs and Rating Values and Assigned-Risk Rates to Be Effective March 1, 2016

Advisory Loss Costs and Rating Values Effective 3/1/2016

Assigned-Risk Rates and Rating Values Effective 3/1/2016

2015 NCCI Loss Costs and Assigned-Risk Rates

NCCI Circular: Approval of Voluntary Loss Costs and Rating Values and Assigned-Risk Rates to Be Effective March 1, 2015

Advisory Loss Costs and Rating Values Effective 3/1/2015

Assigned-Risk Rates and Rating Values Effective 3/1/2015

2014 NCCI Loss Costs and Assigned-Risk Rates

NCCI Circular: Approval of Voluntary Loss Costs and Rating Values and Assigned-Risk Rates to Be Effective March 1, 2014

Advisory Loss Costs and Rating Values Effective 3/1/2014

Assigned-Risk Rates and Rating Values Effective 3/1/2014

2013 NCCI Loss Costs and Assigned-Risk Rates

NCCI Circular: Approval of Voluntary Loss Costs and Rating Values and Assigned-Risk Rates to Be Effective March 1, 2013

Advisory Loss Costs and Rating Values Effective 3/1/2013

Assigned-Risk Rates and Rating Values Effective 3/1/2013

2012 NCCI Loss Costs and Assigned-Risk Rates

NCCI Circular: Approval of Voluntary Loss Costs and Assigned Risk Rates to Be Effective March 1, 2012

Advisory Loss Costs and Rating Values Effective 3/1/2012

Assigned Risk Rates and Rating Values Effective 3/1/2012

2011 NCCI Loss Costs and Assigned-Risk Rates

Advisory Loss Costs and Rating Values Effective 3/1/2011

Assigned Risk Rates and Rating Values Effective 3/1/2011

2010 NCCI Loss Costs and Assigned-Risk Rates

Advisory Loss Costs and Rating Values Effective 3/1/2010

Assigned Risk Rates and Rating Values Effective 3/1/2010

2009 NCCI Loss Costs and Assigned-Risk Rates

Advisory Loss Costs and Rating Values Effective 3/1/2009

Assigned Risk Rates and Rating Values Effective 3/1/2009