The state of California is subjected to the third highest workers’ compensation rates in the entire US, trailing only Alaska and Connecticut according a survey completed this year.  The rate that California businesses pay out is $2.92 per $100 of salary, which is 55 percent greater than the national median rate.  In 2010, California was the fifth the last time this survey was taken, so it has been trending upward.

This spurred California governor Jerry Brown and the state government to overhaul California’s $17-billion workers’ compensation insurance program.  The law is expected to save businesses anywhere between $400 million to $1 billion annually. The reform also hopes to increase the benefits for injured workers.

Payments to permanently incapacitated victims of job-related accidents are set to increase by nearly $740 million dollars a year.  Money for the boost would come from streamlining the system and by eliminating some payments made to doctors, lawyers, claims administrators and other service providers in the $11 billion-a-year workers’ compensation system.

The governor called the proposal an extraordinary bill “to reform a broken system.” This legislation would “avert an imminent crisis where workers suffer and rates will skyrocket,” he said. “We have the chance to make the workers’ compensation system better — much better — for workers and cheaper for business.”  Worker’s compensation is an example of a controllable expense if you are a contractor or in any business.  If you have questions about what other liability coverage you need for a job or would like to check your rates, please contact a dedicated insurance agent at Wise Insurance Agency in Marin County today.