Insurance Commissioner Dave Jones issued a revised workers' compensation insurance advisory pure premium rate, lowering the benchmark to $1.74 per $100 of payroll for workers' compensation insurance, effective June 1, 2018. The order sets the advisory pure premium rate below the $1.80 average recommended by the Workers' Compensation Insurance Rating Bureau in its filing.

Commissioner Jones has reduced the benchmark rate by 36.5% since January 2015, when the average pure premium rate was $2.74 per $100 of payroll. With an average filed pure premium rate of $2.22 per $100 of payroll as of January 1, 2018, insurers are on average applying pure premium rates that are 27.6% more than the indicated pure premium rate approved by the Commissioner today.

“It is time insurers do the right thing and pass along more cost savings to California employers who deserve to share in the benefits cost reductions have brought to the workers' compensation system,” said Commissioner Jones in a statement. “In addition to the cost reductions that have led to higher profits, insurers are also benefiting from the federal income tax break, which should result on average in about another 5% decrease in premiums.”