WOODED – Basic rate of insurance against accidents at work for Idaho the number of employers will decrease by 7% in 2022, provided that what the head of state insurance says should be a boost for “not only Idaho businesses and their employees, but also the economy in general.

Employers purchase workers’ compensation insurance to cover the medical costs of employees who sustain injuries on the job. Each year the National Compensation Insurance Board examines the volume of claims, usage, manpower, wages, and legislative changes to arrive at recommended base rates for each state.

Idaho director of state insurance Dean Cameron said: “I will say that I think we still have room for improvement, looking for other ways to reduce the costs of compensating workers. I think there are other things we can look at later, but it’s complicated and it takes one step at a time.

Idaho’s rates are currently slightly lower than those in Montana, but higher than those in Oregon or Nevada. Utah has rates lower than IdahoCameron said, “but they have inferior advantages.” State differences can be related to everything from the makeup of the industry to health care costs.

The drop in rates for 2022 is largely due to the drop in claims and the use of the workers’ compensation system during the period the NCCI is studying to formulate its 2022 recommendation for Idaho, which included 2018, 2019 and part of 2020.

The pandemic had an impact on claims and use in 2020, Cameron said, “although at this point it appears to be quite minor,” until the full period. “There is no doubt that we had fewer people working and fewer claims submitted,” when the coronavirus shutdown.

A small factor in the decrease, Cameron said, is legislation that was passed unanimously this year to update state laws regarding insurance codes. HB 78 included the elimination of an obsolete provision that set both minimum and maximum rates for workers’ compensation insurance rates, causing carriers to simply charge the maximum. He said the NCCI calculated that just under 1% of the recommended decrease was due to this change.

The rates that individual employers pay will vary depending on the type of industry and its risk of injury to employees, as well as the history of claims.

Once the NCCI recommendation is published, individual insurance companies can request deviations of up to 15% above or below the recommendation. Cameron said the State insurance fund, which operates as a sort of carrier of last resort, is typically around 10% below the NCCI’s recommendation in its tariffs.

Globally, in 2022, he said, “The rates should go down, and if they don’t go down, the employer should say, Why aren’t my rates going down? What makes me more expensive than others?

“Ultimately, employers should visit their agent and consider their workers’ compensation plan,” he said. “And if the rates don’t come down on renewal, every time they renew, then they should be having this difficult conversation.”

Employers pay for workers’ compensation insurance, but Cameron said employees would also benefit from lower rates next year because of the impact on their employer’s overall profitability. “In these difficult times, when they are trying to retain their employees and wages are rising dramatically, those savings will, in my opinion, likely be absorbed into wages and salaries,” he said. “It will be a help or assistance to these employers and employees as they work through these negotiations.”