The Great State of Texas and Workers' Compensation

After having a couple great weeks in Texas, thought I'd share some insights ---Workers' compensation pricing is for certain unique in Texas.  An awesome link to bookmark. http://www.tdi.texas.gov/wc/regulation/rcomp.html

First off, it is where more employers "opt out" of the workers' compensation system then anywhere else in the country (only New Jersey and Oklahoma currently allow although South Carolina and Tennessee are seriously considering).  Opinions run in the vicinity that 30-40% of <50 employee firms opt out.Secondly, it is the only state in the country that allows carriers to negotiate experience modifications outside of an actuarial rating bureau such as the NCCI.Thirdly, carriers can either file for the Texas relativity or a deviation thereof.  Or... A carrier can file for a loss cost multiplier that is factored off NCCI loss costs.  True North on pricing is a tad more challenging.Lastly, Texas is by far the most profitable state in the country for workers' compensation with an ROE plus 35%.  Maybe the challenge makes sense!  This state is kicking ass and taking names ! -PRH

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