By Scot Kersgaard
2016 should mark the third straight year that workers’ compensation rates have fallen in Oklahoma, according to Oklahoma Insurance Commissioner John Doak.
The 2016 reduction is tagged at 14.8%, which brings the three-year total reduction in rates to 37.2%.
“As these rates decrease, Oklahoma business owners can pay less for workers’ compensation insurance and instead invest in growing their business,” said Doak. “It is a step in the right direction for Oklahoma’s economy.”
Oklahoma Governor Mary Fallin was pleased with the announcement. “Today’s news is a win for all Oklahomans. A third year of rate reductions demonstrates that reforms to the workers’ compensation process have delivered a system that is efficient and fair to both workers and employers,” she said.
The reduction stems from a report issued by the National Council on Compensation Insurance (NCCI), which said key factors leading to this reduction in costs for Oklahoma include:
- A decline in lost-time claims driven by workers’ comp reform legislation passed in Oklahoma and implemented between 2011 and 2014.
- Average indemnity claim costs increasing at a slower pace than wages in Oklahoma.
Commissioner Doak has made workers’ comp reform a keystone of his administration. In 2013, Oklahoma’s average workers’ comp costs were $830 per employee, compared with less than $300 in Texas and Arkansas. Today, Oklahoma’s costs are down to about $520 per employee.
The cornerstone of Doak’s reform effort is Oklahoma Senate Bill 1062, passed in 2013, which changed a court-based system to an administrative system. It even allows some employers to opt out of workers’ comp if they implement their own program, and to date 56 companies have done so.
Critics have complained that the reforms have reduced workers’ rights and their compensation for workplace injuries by reducing how much time they have to file after an injury and how much they are able to collect for injuries.
