Workers’ Comp Premiums in Texas Drop by 49% Since 2005

Texas employers are seeing a major reduction in workers’ compensation insurance premiums, an insurance trade group reports. The Insurance Council of Texas (ICT) says the drop is the result of reforms in House Bill 7, passed in 2005, and earlier legislation that improved the efficiency of the Texas workers’ comp system.

Since House Bill 7 was passed premium costs for workers’ comp policies declined 49 percent, according to information from the Texas Department of Insurance. The average premium was $1.38 per $100 dollars of payroll in 2010, compared to $2.70 per $100 of payroll in 2004.

A new study entitled “Premium Rate Ranking Summary” published by the Oregon Department of Consumer and Business Services, listed Texas as the state with the most improvement in premium costs since 2010. Texas’ workers compensation premiums fell from a nationwide high ranking of 12 down to 38.

HB 7 overhauled the workers’ comp system by providing for the use of healthcare networks, strengthening medical treatment guidelines, placing a greater emphasis on return-to-work and restructuring the workers’ comp agency.