L&I 2013 Workers’ Compensation Rates

After a tumultuous 2011 that threatened the very existence of the public Workers’ Compensation monopoly in Washington, L&I has seen the path ahead and it is paved in eggshells. Thus, to everyone’s surprise, they announced no raises in rates for 2013 despite their contingency reserve issues. This may leave you breathing a sigh of relief and moving on with your life and your business. Yet, the future of their organization is far more complicated than you might realize.

Can Your Growth Lead to Higher Premiums

L&I cites the fact that injuries are down for 2012 as one of the main justifications for stagnate rates. So they’ve decided to test Murphy’s Law and depend on this trend continuing through the next decade. To be fair, the trend of worker injuries in the workplace has gone down steadily since 2008. This means we can reasonably predict that they will go down in 2013, right?

Not necessarily.

In 2008, the great recession hit and no industry was hit harder than the construction industry, one of the major contributors and users of the WA L&I system. This lead to massive layoffs. Fewer workers mean fewer claims, but according to the Bureau of Labor Statistics, that trend is coming to an end in Washington State. Upon review of their data you can see a gradual rise in employment and that means that more workers are entering back into the L&I pool.

Be Prepared

In essence, L&I needs to increase their contingency reserves significantly and by not increasing rates this year, they are postponing the issue into future years. In spite of what happens to claims trends, the issue surrounding their contingency reserve will continue to haunt us for years to come.

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