Minnesota workers' comp association distributing $600M surplus

Minnesota’s Workers’ Compensation Reinsurance Association (WCRA) is preparing to distribute a $600 million surplus to licensed insurers and self-insurers of workers’ comp (as of Dec. 2, 2021). Additionally, any employer that had a workers’ comp policy in 2020 will also be eligible for a portion of the surplus, the association reported.

WCRA reported that of the surplus, $383 million will go to insurers, $182 million will be given to self-insurers and $35 million will be divvied up among some 1000,000 policyholders. As required by state statute, every licensed insurer and self-insurer of workers’ comp in the state is a member of WCRA.

The surplus was built on investment results, according to WCRA, which reported its recent investment returns have “exceeded the expected long-term investment returns factored into our rates.” Favorable inflation rates, a drop in claims frequency and legislative changes also played a role in building the surplus.

Since its creation 42 years ago, WCRA has distributed surpluses in 1992, 1993, 1996 and 2000. WCRA’s five surplus distributions total more than $1.8 billion.

Policyholders should begin receiving pre-notice letters in October and there are no other actions required of policyholders to receive checks, WCRA reported.

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