MONTPELIER — Vermont businesses will see a decrease in workers compensation insurance rates for a fifth straight year in 2021, Gov. Phil Scott’s administration announced Monday.
In the voluntary market, where about 90 percent of employers obtain workers compensation insurance coverage, loss costs will decrease by an average of 5.5 percent, Scott’s administration said in a news release.
In the assigned risk market, where employers unable to obtain coverage in the voluntary market purchase insurance, rates will decrease by an average of 4.6 percent.
When combined with previous decreases from 2017-2020, Vermont employers will pay an average of 36 percent less in workers’ compensation premiums than they did in 2016, according to the release.
“As we work to grow the economy and size of our workforce, addressing the high cost of doing business in Vermont is critical,” Scott said in the release. “I’m proud that we’ve been able to reduce these costs annually, 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.”
“It is very encouraging that Vermont continues its streak of workers’ compensation premium decreases even during the unprecedented times brought on by COVID-19,” Department of Financial Regulation Commissioner Michael Pieciak said in the release. “Vermont businesses have seen unparalleled challenges this year as they try to keep their employees safe while remaining open for business and I am pleased to see these efforts pay off with a continued reduction in rates.”
The Department of Financial Regulation helped prevent a rate increase this year by excluding payments under the COVID-19 Front-Line Employees Hazard Pay Grant Program from being included in the calculation of premiums, according to the Scott administration. That in turn removed financial barriers for employers to participate in the program and avoiding a $2 million cumulative increase.
The department also prevented businesses from experiencing a premium increase if they have a COVID-19 related workers’ compensation claim, and ordered premium relief for employers who paid furloughed employees during the pandemic.