Workers’ Compensation Fund To Increase Premiums
California Insurance Commissioner John Garamendi Monday said that the not-for-profit State Compensation Insurance Fund will raise premiums to cover more potential liability, the San Francisco Chronicle reports. The fund insures about 50% of state businesses against workplace injuries and will raise premiums by an undetermined amount, according to the Chronicle. Garamendi said part of the reason for the rate increase is "price wars" among private insurers after the elimination of the state's minimum premium amount and an increase in the number of policies underwritten by the fund. Mark Sektnan, vice president of the American Insurance Association, said, "If State Fund goes insolvent, the hit on the state would be bigger than anything we've ever had before. What do you do if 53% of the market doesn't show up for work one day?" About half of the fund's money covers medical expenses. Although some lawmakers have introduced legislation to repeal employee compensation increases approved last year, Garamendi said a better focus would be lowering medical expenses and other factors that affect compensation insurance costs (Lucas, San Francisco Chronicle, 3/4).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.