CHICAGO — State officials recently announced that Illinois workers’ compensation rates have dropped nearly 20 points in the last three years.
“The major workers’ compensation reforms we enacted in 2011 are protecting workers while continuing to reduce the cost of doing business in Illinois,” Gov. Pat Quinn said in a statement. “Illinois’ economy is making a comeback and major reforms like those to workers’ compensation are driving it. We are getting the job done for our hardworking men and women and businesses across Illinois.”
The National Council on Compensation Insurance is a data analysis and research companies that monitors workers’ compensation rates across the country. It studied Illinois’ insurance rates and credits the drops to the Quinn-backed 2011 legislation that ushered in required rate drops from the state.
The Illinois workers’ compensation rate has dropped 19.3 points since that 2011 reform.
“The NCCI’s reported decrease is proof that workers compensation costs are significantly lower than they were in 2011,” Chairman of the Illinois Workers Compensation Commission Michael Latz said in a press release. “This demonstrates that insurance companies have had to pay less money on claims since 2011 and have enjoyed more profit.”
The NCCI said the decrease reflects a major reduction in the cost of claims paid by insurers and provides key savings for businesses across Illinois.
The announcement follows last month’s news that the NCCI recommended an additional rate drop of 5.5 percent in 2015. The governor’s office says the combined savings from a lessened workers’ compensation burden will save Illinois employers $450 million next year.
Quinn has “made it a priority to reform workers’ compensation and to work with business owners and legislators to make it easier to do business in Illinois,” his office said in a statement.
Gary Burtless is a senior fellow of economic studies at the Brookings Institute, and says lower workers’ compensation rates will lead to job growth and economic stability.
“The more employers are required to pay into the workers’ comp system, the less they can spend on business expansion and hiring,” Burtless said. “In short, high rates prevents growth. Illinois lowering its rates will be a positive for the economy.”
Greg Baise is the president and CEO of the Illinois Manufacturers Association, and said lower workers’ compensation rates will play a major factor in keeping Illinois businesses in Illinois.
“Many Midwestern states have more business-friendly policies than does Illinois,” Baise said. “Hopefully by reducing the workers’ comp rates we can begin to see more business growth and hiring in our state again. That’s what it really needs.”
Brady Cremeens is a reporter for the Illinois News Network.