Vermont Businesses To See Decrease In Workers’ Compensation Insurance For Record Sixth Year In A Row
Montpelier, VT (STL.News) Governor Phil Scott and Department of Financial Regulation (DFR) Commissioner Michael Pieciak today announced that Vermont businesses will see another rate decrease in workers’ compensation insurance in 2022. This is the sixth straight year workers’ compensation rates have decreased, and when combined with decreases from 2017-2021, Vermont employers will pay an average of 41% less in premiums than they did in 2016.
The rate reduction will be effective on April 1, 2022, which is estimated to save Vermont employers over $8 million in premiums during the upcoming year.
“As we work to grow the economy and our workforce, addressing the high cost of doing business in Vermont is critical,” said Governor Scott. “A major expense for Vermont businesses has been workers’ compensation insurance, so I’m proud that we’ve been able to reduce these costs each year, without reducing benefits for workers. These savings will help Vermont employers of all sizes hire more workers, increase salaries and expand their operations in our state.”
“As Vermont businesses and workers face unparalleled challenges brought on by the COVID-19 pandemic, it is very encouraging to see that workplaces are continuing to become safer, which translates into lower workers’ compensation rate,” said DFR Commissioner Pieciak. “I applaud Vermont’s business community and the staff at the department for their work to make our workplaces safer and our state more affordable.”
The multi-year decreases reflect the continuing efforts of Vermont employers to maintain safe workplaces and a continued focus by the DFR to make workers compensation insurance more affordable to Vermont businesses.
Employers purchase workers compensation through one of two markets, the voluntary market and the assigned risk market. In the voluntary market — the open competitive market — loss costs will decrease by an average of 4.9%, which is the primary component of workers’ compensation rates. Approximately 90% of Vermont employers receive voluntary market coverage. In the assigned risk market — the market for employers unable to obtain coverage in the voluntary market — rates will decrease by an average of 5.6%. The continued rate relief in the assigned risk market is particularly good news for new businesses which are often required to obtain coverage through this market due to their lack of a claims history.