On March 2nd, Boston.com had a brief blurb saying that the Massachusetts’ Worker’s Compensation rates may go up. Workers’ comp rates could go up

What was understated is what is currently being proposed… A 19.3% increase!!! This is the largest rate increase sought by the rating bureau in memory. The increase goes into effect on September 1st if it is approved.

This rate hike will make the cost of doing business in the Commonwealth more expensive than it already is. The reason for the hikes stem from the insurance companies – They have simply been losing too much money with the current rates. The last rate hike happened in 2001 and it was a very modest increase (1%). Today’s rates are actually 65% lower than the rates in 1991.


Aside from the cost, the number of insurance companies who offer workers compensation policies have been shrinking and that has significant repercussions as far as the terms and service of a WC policy.

Here is more info from the Workers Compensation Rating Bureau regarding the proposed changes that could have a dramatic effect on experience modifications:

  • Rates will increase on average by 19.3%
  • The maximum claim that can be charged to an ex mod increases from $175,000 to $250,000.
  • The Statewide Average Cost Per Case increases from $7000 to $10000. This changes two long-standing tables used in the experience mod, called Weighting and Ballast Tables.
  • The maximum ARAP surcharge nearly doubles to 49% – currently it is 25%.For contractors eligibility for the Massachusetts Construction Classification Premium Adjustment Program increases from an average wage of $18 per hour to $28. Most construction firms will lose this credit entirely. Others will see their credit greatly reduced.
  • An experience rating offset to lower the construction credit will be revised.
  • 140 classifications will see reduced expected loss rates. That translates to higher experience mods for those employers.
DG will follow these proposed rates and when the Commonwealth makes a decision we will keep you up to date with that news.