Virginia will likely cut the premium rates employers pay to maintain workers’ comp coverage, thanks to a proposed decrease to the state’s advisory loss cost levels from the National Council on Compensation Insurance (NCCI).

The NCCI proposes advisory loss costs that directly inform premium rates in multiple states. Those rates are then subject to formal approval from the relevant state agencies, such as Virginia’s State Corporation Commission (SCC).

If the SCC approves the NCCI’s cuts, most Virginia employers will pay 5.6% less to cover their injured workers, while employers in the state’s assigned risk pool will pay 8.2% less. The cuts would take effect on April 1, 2027.

It’s yet another example of a nationwide trend of plummeting premiums in almost every state, with a few frustrating exceptions like California.

Workers’ comp continues to be one of the most profitable lines of insurance. In response, the NCCI, state authorities, and independent rating bureaus are pushing premiums down around the nation. But in California, the Workers’ Compensation Insurance Rating Bureau (WCIRB) insists that insurers need more employer dollars; a 6.6% premium increase takes effect in September, following last year’s 8.7% hike.

California employers deserve a better explanation than the WCIRB has offered so far.

In particular, employers should demand a clearer accounting of the excessive administrative expenses of delivering workers’ comp benefits in California, a source of profitable friction that keeps claim costs high despite manageable medical costs and low provider reimbursement rates.

NCCI to Virginia: Cut Rates

According to the Richmond Times-Dispatch, the proposed cuts would be Virginia’s seventh consecutive annual premium decrease. In the most recent ranking from the Oregon Department of Consumer and Business Services, Virginia had the eighth-lowest premium rates nationally in 2024.  

The NCCI cites better workplace safety, fewer lost-time claims, and the implementation of a workers’ comp medical fee schedule in 2018 as the biggest contributing factors to a generally healthy outlook, one in which insurers can afford to ease the burden on employers:

“...there has been a long-term pattern of improved workplace safety and an increasing integration of automation. These factors have put downward pressure on the frequency of lost-time claims. Additionally, in Virginia, the medical fee schedules have effectively controlled costs relative to changes in workers’ wages over time.”

The Times-Dispatch notes that, unlike other states, Virginia does not require workers’ comp insurance to cover repetitive stress injuries, exempting some occupational conditions that, in every other state, would warrant treatment or indemnity benefits.

WCIRB to CA: Keep the Premium Dollars Flowing

daisyNews has reported in detail on workers’ comp premium cuts in Texas, Florida, New York, Ohio, New Jersey, Arizona, Tennessee, and Delaware. Many rely on the NCCI to determine rates, while others use their own independent rating bureaus (the Ohio state government provides coverage and determines rates).

All have decided in recent years to slash premiums. Yet the WCIRB, an insurer-funded entity credibly accused by industry experts of “skewing” its data to the benefit of its insurer members, continues to demand higher premiums from California employers.

The Bureau’s justifications for doing so are questionable and, in our view, fail to adequately distinguish between necessary medical and benefit costs and costs that arguably result from insurers’ choices, such as litigation, “Medical Cost Containment Programs,” Medical-Legal disputes, and more.

VA vs CA: Where’s the Money Going?

The NCCI credits Virginia’s workers’ comp fee schedule as likely the most significant cost-control measure that has helped lower premium rates. That’s especially noteworthy in light of a 2025 Workers Compensation Research Institute report showing that Virginia’s fee schedule rates (equal to 240% of Medicare rates) were significantly higher than California’s (151% of Medicare rates).

In other words, in Virginia, premiums are on the low end nationally and provider reimbursement rates are on the high end. In California, it’s the opposite:

• Insurers in Virginia collected the eighth-lowest premiums nationally in 2024, yet paid providers the 5th-highest fee schedule rates nationally in 2025. Meanwhile,
• Insurers in California collected the fourth-highest premiums in 2024, yet paid providers the tenth-lowest fee schedule rates in 2025.

So where are all those California premium dollars going?

There are good-faith debates to be had about the differences between states like Virginia and California that may account for some of the gap in premium rates, e.g., Cumulative Trauma claims and Virginia’s baffling refusal to recognize repetitive stress injuries.

However, those differences alone cannot account for the extraordinary administrative expenses of delivering care and benefits to California workers, nor can they excuse the apparent deficiencies in the WCIRB’s justifications for continued rate hikes.

California employers, it’s time to make some noise.

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