TALLAHASSEE, Fla. – The Florida Office of Insurance Regulation (Office) has released the 2015 Workers' Compensation Annual Report to the Florida Legislature.
The Office’s analysis shows Florida’s market continues to remain competitive, well capitalized and affordable with more than 250 private insurance companies writing over $2.5 billion in premium. Of the six most populous states analyzed, Florida is one of only two where a private market insurance company is the largest insurance company in the state rather than a state-created residual market entity. Private insurance companies dominate the market by writing more than 95% of the workers’ compensation coverage.
A rate decrease of 4.7% effective on January 1, 2016, the second in two years, represents a 60.3% cumulative reduction in Florida’s workers’ compensation rates since the 2003 legislative reforms were passed. This is an indication the reform measures delivered the desired result and lowered costs dramatically.
Although these reforms continue to benefit the market overall, it is likely their impact may have reached maximum effectiveness. Several pending court cases, which could negatively affect the workers’ compensation market by leading to increased rates and the state’s inability to retain its competitive advantage in this area, are being closely monitored by the Office.
Medical cost drivers, particularly in the areas of drug costs, hospital inpatient, hospital outpatient and ambulatory surgical centers are higher in Florida than the countrywide average. Legislative reforms may prove beneficial in addressing these issues.
Overall, Florida’s workers’ compensation system is robust and not overly concentrated. It continues to allow for ease of entry and exit for insurance companies in the marketplace, and the residual market is small relative to the private market indicating reasonable availability.
The Office is required by law to annually evaluate competition in the workers’ compensation market and to investigate and use data in its review of such rate filings. For more information, please visit the Office’s Workers’ Compensation webpage.
About the Florida Office of Insurance Regulation:
The Florida Office of Insurance Regulation has primary responsibility for regulation, compliance and enforcement of statutes related to the business of insurance and the monitoring of industry markets.
For more information about the Office, please visit www.floir.com or follow us on Twitter @FLOIR_comm and Facebook.
Florida Office of Insurance Regulation Issues 2015 Workers’ Compensation
Annual Report