Delaware State News, August 20, 2008

DOVER — Insurance Commis­sioner Matthew P. Denn slashed workers’ compensation insur­ance premiums Tuesday by 11.57 percent, a move designed to save Delaware businesses more than $14 million.

It is the second straight year Mr. Denn has ordered workers’ comp rates cut — he ordered 17.75­22 percent in cuts in November, which was the largest cut in insur­ance rates in at least 25 years.

“When I took office in 2005, our rates were among the high­est in the country,” Mr. Denn said. “ With the amount we’ve reduced rates in the past year — about 30 percent — we can call workers’ comp reform a success.”

And Mr. Denn said he expects to order at least another 10 per­cent in rate cuts by the end of the year. Delaware businesses, which have paid some of the highest work­ers’ comp rates in the country, shell out about $122 million each year for the insurance.

“This will help employers con­trol costs,” Mr. Denn said. “It will make businesses, like contractors who have to compete with out­-of-state businesses, be competi­tive.”

While Mr. Denn did not have comparative stats with other states in recent years, he noted that most workers’ comp rates throughout the country have ei­ther remained flat or increased in recent years.

Tuesday’s reduction is the di­rect result of legislation passed last year designed to save Dela­ware employers up to $43 million annually in workers’ compensa­tion premiums.

The new law creates a health care advisory panel to craft a fee schedule for medical costs and charges and standardized prac­tice guidelines for medical treat­ment of injuries, saving Delaware employers 15-21 percent in work­ers’ compensation costs.

But, in the order to insurance companies, Mr. Denn warned that the workers’ compensation insur­ance companies have “not made sufficient efforts to determine the potential cost savings to carriers of all of the provisions of Senate Bill 1,” and told the carriers and insurance department staff to provide him with information to consider additional reductions.

“I intend to ensure to the maximum degree permitted by law that any likely cost savings re­sulting from SB 1 are reflected in lower premiums rather than be­ing retained as windfall gains by insurance carriers,” Mr. Denn said in his order.