Workers’ Compensation Insurance Loss Cost Average Sees Cumulative 51.5% Decrease Over Last 10 Years

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Vincent Plymell

Colorado Division of Insurance approves another decrease of 3.4% for 2024.

DENVER - The Colorado Division of Insurance (DOI), part of the Department of Regulatory Agencies (DORA), has approved a reduction of 3.4% (-3.4%) for the average “loss costs” component of workers’ compensation insurance premiums for 2024. 

This will be the tenth consecutive year without an increase to this key measurement in workers’ compensation insurance. Over the last 10 years, the average overall annual decreases in the loss costs component have led to a 51.5% (-51.5%) cumulative average decrease.

Loss costs are the average cost of lost wages and medical payments of workers injured during the course of their employment. Factors that may increase or decrease workers’ compensation costs include: frequency of injuries, duration of claims, number of treatments for each claim, severity of injuries, increasing medical costs and overall costs to cover workers’ compensation claims. 

“Workers’ compensation insurance is vital for Colorado employers and employees, providing employers with a standard method of protecting employees injured on the job,” said Colorado Insurance Commissioner Michael Conway. “Decreasing the loss cost component of workers’ comp over the last decade shows that Colorado employers continue to work on keeping their employees safe to prevent injuries.”

The average loss costs component is the average of changes across all worker classifications within the manufacturing, contracting, office / clerical and goods and services industries (and also includes a miscellaneous industry category). 

While statewide average loss costs have been decreasing for years, and will again decrease 3.4% for 2024, employers may see variation in their workers’ compensation premiums, either increases or decreases, based on their particular classification code or industry group.

The National Council on Compensation Insurance (NCCI), a rating and advisory organization, collects annual data on workers’ compensation claims for the insurance industry, and publishes loss costs that form the basis for all workers’ compensation premium determinations. All insurers in Colorado use the NCCI loss costs as a base. Each insurer's own expenses are added to the NCCI’s loss costs to arrive at the rates charged to employers. This is another reason why an individual employer’s specific rate change may be different from the -3.4% change.
The projected loss cost figures for 2024 were submitted by NCCI to the DOI earlier this year. The independent actuarial firm of Merlinos and Associates, Inc. was contracted to provide a review of the analysis for all of the industry classes in Colorado. The NCCI filing, the actuarial analysis and any public comments are used by the Colorado Insurance Commissioner to establish the loss costs used for the premium rates for the upcoming year.
To view the 2024 NCCI loss cost filing, individual classification codes and the final order of approval from the Commissioner of Insurance, visit the DOI’s Workers’ Compensation website.


About the Division of Insurance:

The Colorado Division of Insurance (DOI), part of the Department of Regulatory Agencies (DORA), regulates the insurance industry and assists consumers and other stakeholders with insurance issues. Visit for more information or call 303-894-7499 / toll free 800-930-3745

About DORA:

DORA is dedicated to preserving the integrity of the marketplace and is committed to promoting a fair and competitive business environment in Colorado. Consumer protection is our mission. Visit for more information or call 303-894-7855 / toll free 800-886-7675

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