Matt Denn, the Delaware Insurance Commissioner, announced in early November that he will institute a significant worker’s compensation premium cut for the start of the next calendar year. For most businesses who participate in the “voluntary” workers compensation market, premiums will be cut by an average of 17.75 percent. For businesses purchasing through the state’s assigned risk pool, there will be a 22 percent average cut. Commissioner Denn claims these cuts are a necessary reaction to the Delaware Department of Insurance's research findings that insurance companies tend to overestimate the reserves needed for future medical losses. The premium cuts will set a new limit to the extra funds insurance companies are allowed to set aside and turn into profit when unused. Michael Ciabattoni, vice president of Teamsters Local 326 believes that, as a result of the rate cuts, companies should have more resources available for individual workers’ pay and benefits, making Delaware a more attractive destination for new businesses with new jobs. It is expected that the rate cuts will produce over $18.2 million of savings for Delaware employers. This announcement comes only a month after another effort to reduce workers compensation premiums when Commissioner Denn oversaw the creation of self-insurance organizations for local government employees, a program that is expected to save taxpayer money in smaller communities.

For a copy of the press release, click here.