Work Comp Premium Rate Continues Decline

Saving Employers $446 Million Since 2011

Media Contact: LARA Communications 517-373-9280
Email: mediainfo@michigan.gov

October 11, 2017 – Michigan’s Workers’ Compensation system continues to benefit workers and job providers as the state’s pure premium advisory rate for work comp insurance will decrease by 9.3 percent for 2018. The Michigan Workers’ Compensation Agency announced that the state will see a cumulative decrease of 45 percent from 2011-2018, saving Michigan employers an estimated $446 million in workers’ compensation premiums[1]. The pure premium is instrumental in calculating a job provider’s overall expenses for workers’ compensation and is also a factor in employer insurance claims that cover costs for work-related injuries.

The most recent comparison data shows that Michigan’s cumulative pure premium decrease of 39 percent from 2011-17 is again best in the Midwest and top five in the nation. While Michigan’s rate plummeted, the national average increased by 4.9 percent.[2]

“These tremendous economic savings experienced by employers allows them to hire more workers, increase salaries, open new facilities and move to Michigan,” said WCA Director Mark Long. “Our sustained work comp decreases play an important role in the state’s regulatory environment which continues to attract businesses and add jobs.”

In 2011, Gov. Rick Snyder signed legislation that reformed the state’s workers’ compensation system. The reforms included improvements for disability and post-injury earning capacity. These changes helped to revamp a 100-year-old system and have played an integral role in reducing costs for employees, stabilizing the state’s system and ensuring the promise to protect injured workers.

The Workers’ Compensation Agency emphasizes reducing costs for employers has included administering a fee schedule that helps control medical costs for work-related injuries. In a recent study, it was shown that Michigan had the lowest cost per claim in the United States.

Michigan's injured workers and their employers are governed by the Workers' Disability Compensation Act. The Act was first adopted in 1912 and provides compensation to workers who suffer an injury on the job and protects employers' liability. The mission of the WCA is to efficiently administer the Act and provide prompt, courteous and impartial service to all customers.

Pure Premium Rate 2011-2017

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[1] Compensation Advisory Organization of Michigan, Analysis of Premiums, 2017

[2] National Council on Compensation Insurance, Annual Statistical Bulletin, 2017