Massachusetts has approved a 2.4 percent decrease in workers' compensation insurance costs, a figure that should reduce premiums by an estimated $22.5 million this year.
Originally the Workers' Compensation Rating and Inspection Bureau, a private, nonprofit organization of Massachusetts workers' compensation insurers, had asked for a 4.5 percent increase in rates. Based on the projected workers' compensation premiums of $935 million. That figure would have increased premiums by about $42 million statewide.
The rate reduction, which goes into effect Sept. 1, marks the tenth rate reduction in the Bay State since 1994.
"Lowering the cost of workers' compensation insurance is very much in keeping with our larger goal of improving the state's business climate so that we can grow the economy and create jobs," Gov. Deval Patrick said.
Barbara Anthony, undersecretary of the office of consumer affairs and business regulation, said the cut "offers further proof that reforms have created efficiencies within the system that continue to produce savings for businesses."
However, Paul Meagher, president of the Workers' Compensation Rating and Inspection Bureau of Massachusetts (WCRIBMA), sounded less enthusiastic about the cuts.
"In today's uncertain economic climate, maintaining a healthy voluntary market for workers' compensation insurance will likely be a challenge given the continuing increase in claims severity and low expected industry investment returns," he said. "The WCRIBMA is committed to working with its committees, members, regulators, and other stakeholders toward our shared goal of a stable and healthy workers' compensation market in the Commonwealth."