Regulatory agencies and legislatures across the country have spent 2024 refining workers’ compensation systems—responding to national trends of decreasing insurance rates, expanding legal protections, and clarifying employees’ rights. From new rate proposals by the National Council on Compensation Insurance (NCCI) to legislative amendments aimed at broadening benefits for certain worker groups, here’s a snapshot of what to expect as we head into 2025.
Decreasing Workers’ Compensation Rates
One of the clearest trends emerging nationwide is the continued reduction of workers’ compensation premium rates in many states. Technology-driven safety measures, better return-to-work programs, and tighter hiring practices have contributed to a notable drop in workplace injuries and, consequently, in overall insurance costs.
• In Connecticut, the NCCI filed for a 6.1% average decrease in workers’ compensation rates for 2025, with a 6.2% average cut in the assigned risk market. The Connecticut Insurance Department approved the drop, continuing a multi-year trend of annual rate reductions that have saved employers cumulatively over $300 million over the past decade.
• West Virginia could see a 9.1% rate reduction in 2025, continuing a 20-year streak of declining workers’ compensation insurance costs. Assigned risk markets may drop even further, by 10.4%, potentially saving West Virginia employers around $15,000 on average.
• In Missouri, the state’s Department of Commerce and Insurance approved a 5.3% rate decrease for 2025—the fourth consecutive annual drop—citing data showing lower average costs per claim.
• Massachusetts recorded a 14.6% reduction in July 2024, its fifth consecutive year of decreases, saving employers an estimated $87 million statewide.
• Florida is poised for a more modest decline, with just a 1% reduction slated to take effect Jan. 1, 2025.
Slight Increases in Some States
Not every state followed the trend of lowering costs. Washington announced a 3.8% workers’ compensation rate increase for 2025, intended to maintain the “financial health” of the system. Officials say this change will help fund crucial wage and medical benefits for injured workers, ensuring continued stability for both employees and employers.
Legislative Shifts and Updates
Beyond premium rates, lawmakers in several states have proposed or passed significant changes to their workers’ compensation statutes. These reforms address who qualifies for benefits, what injuries or conditions are compensable, and how employees are informed of their rights.
Michigan’s New Proposals
Two Michigan bills—S.B. 1080 and S.B. 1079—would significantly alter workers’ compensation entitlement.
• S.B. 1080 proposes new language that guarantees death benefits for a spouse living with the employee at the time of death, presumed to continue for 208 weeks.
• S.B. 1079 adds a presumption that an employee’s wage loss is automatically tied to disability if they were employed for less than 100 weeks, unless the employer proves the termination was due to the employee’s willful and serious misconduct.
• Opponents, including the Michigan Chamber of Commerce, argue that expanded definitions of disability and retrospective application to workers injured on or after June 30, 1985, will overwhelm the system with newly compensable claims.
California’s Notice Requirements
In California, Governor Gavin Newsom signed AB 1870, amending Section 3550 of the Labor Code. Employers must now include information about an injured employee’s right to consult with an attorney—often at no direct cost to the employee—in posted workplace notices. Failure to comply can result in misdemeanor charges and serve as prima facie evidence of non-insurance.
Pennsylvania’s First Responders
Pennsylvania enacted Act 121 of 2024 (formerly Senate Bill 365), lowering the burden of proof for first responders claiming PTSD. Under the new law, firefighters, police officers, emergency medical technicians, and paramedics no longer need to demonstrate “objectively abnormal working conditions.” Instead, the law recognizes psychological trauma from individual or cumulative experiences, increasing the likelihood that these professionals will receive benefits when they suffer from work-related stress injuries.
Looking Ahead
Employers, insurance carriers, and employees alike should stay informed of these shifting landscapes. While many states are enjoying the positive effects of declining rates—spurred by better safety, technology, and return-to-work programs—others are making legislative moves to expand coverage, ensure fairness, and secure adequate funding.
• Monitor changing rates and factor them into budget planning and worker safety initiatives.
• Review legal and regulatory updates to understand how benefit entitlements or employer obligations may be changing.
• Provide employees with up-to-date notices, especially regarding their right to counsel, to ensure compliance and reduce potential liabilities.
As 2025 unfolds, workers’ compensation is set to remain a hot topic in both legislative chambers and boardrooms. Whether it’s taking advantage of new rate reductions, addressing expanded definitions of disability, or meeting updated posting requirements, stakeholders should stay proactive in navigating the evolving workers’ compensation landscape.