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Sept. 13, 1996

No workers' comp rate increase proposed for third straight year

TUMWATER - For the third consecutive year, premiums that employers and their employees pay for workers' compensation coverage in Washington will not go up.

This is the second time in the last three years that the Department of Labor & Industries has proposed no general rate increase and follows a $300 million reduction in rates for 1996.

"This is more good news for Washington's economy," said L&I Director Mark O. Brown. "No rate increase means employers have more money to invest and workers have more money to take home."

Several factors are behind the proposal for no general rate increase for 1997:

  • Continuing decline in the number of claims filed.
  • A reduction in the time claims are open and benefits for them being paid.
  • Continued success in State Fund investments, which helps to finance benefits and payments for services.

"This proposal is an unprecedented development that helps us to further enhance our competitive standing nationally and contribute to the general improvement in the business climate in our state," Brown added. "It also demonstrates the ability of a public agency to effectively operate one of the largest workers' compensation systems in North America."

In recent years, L&I has managed to reduce premiums, avoid rate increases and meet legislatively mandated benefit increases for qualified injured workers. Washington also ranks near the lowest of states in costs for workers' compensation.

Even though the department is proposing no general rate increase, a required public hearing on the proposal is set for 8 to 10 a.m. Oct. 22 at L&I headquarters in Tumwater.

The workers' compensation system in Washington covers 153,000 employers and 1.7 million workers and is managed by L&I. The system, referred to as the State Fund, pays for lost wages, medical bills and pensions when employees are injured in the workplace.

Benefits are financed through premiums paid by employers and workers and investments made by the department. Even though no general rate increase is proposed for 1997, the State Fund will remain financially strong with sufficient reserves to meet anticipated claims costs in the future.

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