For the second year in a row, the Workers' Compensation Insurance Rating Bureau (WCIRB) wants California employers to pay more for workers' comp coverage.

Last year, the WCIRB secured an 8.7% premium increase. This year, the WCIRB is asking the state’s Insurance Commissioner to approve an additional 10.4% increase, effective September 1, 2026.

The WCIRB is funded exclusively by its insurer members; the same companies that benefit when premiums rise. Its underlying claims data are self-reported by insurers, not independently verified, and not available to the public for review.

The WCIRB's recommendation to increase employers’ premiums runs counter to the trend in nearly every other state, where premiums are falling. It defies the facts that California's medical fee schedules are among the lowest in the nation, national medical inflation is modest, and California workers' comp insurers are reporting healthy loss ratios.

The WCIRB nonetheless argues that California employers must pay more, attributing much of the increase to cumulative trauma claims. But the supporting evidence is nearly impossible for employers or the public to assess. What the state and the public do have access to, i.e., the WCIRB's formal rate filing and a slide deck purporting to justify the increase, falls apart on close inspection. Yet, California employers will be assessed billions based on the figures therein.

Below, we walk through how the WCIRB explains its proposed increase and where its case breaks down. Every employer in the state deserves a much, much clearer accounting.

A Rate-Setting Body Funded and Governed by Insurers

The WCIRB is funded exclusively by its insurer members, which dominate its Governing and Actuarial committees. The current insurer members governing the WCIRB are:

• Federal Insurance Company
• Hartford Accident and Indemnity Company
• Pacific Compensation Insurance Company
• Preferred Employers Insurance Company
• Republic Indemnity Company of America
• State Compensation Insurance Fund
• Travelers Property Casualty Company of America
• Zenith Insurance Company

These are the same companies whose premium revenues are determined, in significant part, by the rates recommended by the WCIRB. The underlying claims data the WCIRB uses to build its rate recommendation come directly from these insurers, are not independently audited, and are not publicly available.

WCIRB Chart Raises More Questions Than Answers

Below is a graph from a slide deck from the WCIRB's Actuarial Committee. Titled "Components of Indicated Advisory Pure Premium Rate Change," it purports to lay out the factors involved in the WCIRB's request for a 10.4% premium increase.

Where to begin with this graph? It appears to present hard data in a meaningful way…as long as you don’t look too closely.

On the left are two bar figures: the 11.2% increase the WCIRB formally requested for 2025, and the 8.7% increase the Insurance Commissioner actually approved. On the right is the proposed 10.4% increase for 2026. In between is a series of erratic arrows vaguely purporting to represent how the WCIRB arrived at 10.4%.

The arrows have no specific numerical values. Each is taller or shorter to indicate a relative contribution to the proposed increase, with no underlying figures shown on the chart and no accompanying table.

For example, the first arrow is labeled "Difference to 9/1/2025 Approved." This refers to the 2.5% gap between the 11.2% the WCIRB requested for 2025 and the 8.7% the Commissioner actually approved, which roughly matches the arrow's height on the y-axis. Each subsequent arrow represents some ill-defined value, vaguely correlated to its height and position on the chart, to indicate how each factor added to (or, in the case of "Wage Level Forecast," subtracted from) the premium increase.

While references to some of the arrows’ underlying values can be found elsewhere in the presentation, there is no citation to explain these floating arrows.

No employer could look at this graph and find a specific, decipherable rationale for a 10.4% increase in their premiums.

Adding Last Year's Requested Increase to This Year's Tab?

The presence of the "Difference to 9/1/2025 Approved" arrow on the chart suggests one thing: that in asking for a 10.4% hike, the WCIRB factored in the gap between the premium hike it requested last year (11.2%) and the premium hike California actually approved (8.7%).

As the Workers' Comp Executive noted,

"The leftover increase from last year's request, as well as an off-balance adjustment related to experience rating, accounts for over a third of the requested increase…"

In other words, last year, California raised premiums by 2.5% less than the WCIRB requested, and the chart indicates the WCIRB wants to carry that balance forward to 2026.

If that is what the chart represents, the WCIRB is asking employers in 2026 to pick up a portion of an increase that the Insurance Commissioner already declined to approve. Employers deserve a clear, line-item explanation of what this component represents.

The Fine Print: WCIRB's Actual Rate Filing

Perhaps most tellingly, the chart does not align with the WCIRB's justification for the 10.4% increase in the Pure Premium Rate filing it submitted to the state.

Several graphs and charts from the slide deck appear in the formal filing. The chart above is not one of them. The filing makes no mention of the gap between the requested 11.2% for 2025 and the approved 8.7%, even though that gap appears prominently in the slide deck chart.

Instead, the formal filing presents the calculation behind the 10.4% figure as a compact actuarial formula in "Exhibit 8.”

The charts and the Exhibit below may be reconcilable. However, the WCIRB has not publicly demonstrated how.

Sloppy Errors

It is also worth noting that the chart contains a basic labeling error.

The orange bar on the left is labeled "CDI [California Department of Insurance] 9/1/2024 Approved." With a value of 8.7% at the top of the bar, this clearly refers to the 8.7% premium increase for 2025, not 2024.

A typo on a single label is, in isolation, minor. But this chart is part of the public-facing justification for an increase that will translate into billions of dollars in additional employer premiums. Basic accuracy matters.

CA Employers Deserve Better

California employers pay mandatory premiums set through a process they cannot meaningfully investigate or audit, based on data they cannot review, justified by a slide deck that lacks clarity on every essential point.

A more accountable process would include, at a minimum:

• A public, line-item breakdown of every component of the recommended rate change, with specific numerical values rather than unlabeled arrows.
• A clear, written statement of whether and how prior-year rate decisions are factored into the current recommendation.
• Reconciliation between the slide deck presentation and the formal rate filing.
• Independent verification of the underlying insurer claims data, or at a minimum, public access to that data in a form that allows third-party review.

Until those things exist, employers and the Insurance Commissioner are being asked to take a great deal on faith from a body funded and governed by the parties who benefit from the outcome.

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