Bickmore Risk Services and Consulting

DWC Study of Legislative Reform

BRS was selected by the State of California to conduct a study of the major legislative reforms of the workers' compensation system in California. The California Department of Industrial Relations Division of Workers Compensation (DIR/DWC) is a State agency charged with regulatory oversight of many aspects of the California workers' compensation system. The DIR is responsible for regulating all private and public sector individual self-insurers, as well as group self-insurers.

This study involved analyzing the impact of the reforms on claims costs, insurance company filed and charged rates, insurance company profits and surplus, and competition. We also analyzed the historical accuracy of rates recommended by the California Workers' Compensation Insurance Rating Bureau and the California Department of Insurance. Despite widespread disagreements that existed prior to our report, the BRS study was received favorably by major stakeholders in the debate, including the California state government, employers, insurers, and research institutions.

• Table of Contents
• Preface
• Acronyms
• Executive Summary
• I. Background Leading to Workers' Compensation Reform
• II. Scope and Approach
• III. Claims Savings Generated by Reforms
• IV. Effects of Reforms on Insurance Rates
• V. Effects of Reforms on Insurance Industry Surplus and Solvency
• VI. Insurance Marketplace and Competition
• VII. Adequacy and Accuracy of Rates
• VIII. Evaluation of Reforms in Other States
• IX. Evaluation of Regulatory Structure
• X. Areas of Further Research
• Appendices: A B C D E F G H I J K L M