Workers’ Compensation in Illinois
In 2011, at the strong request of Business and Insurance Companies a Workers’ Compensation “Reform” package was signed into law, aimed at lowering costs for employers in Illinois. Instead, the insurance industry has pocketed enormous profits and has not passed any savings along to employers. Any further changes in laws should instead look to promote insurance premium transparency and oversight – not further sacrifices by injured workers.
- The National Council on Compensation Insurance (NCCI – an insurance industry rate making agency which provides workers’ compensation data) has issued its workers’ compensation advisory rates for 2021. It states that Illinois employers should see a 0.4 percent cut in their workers’ compensation insurance premiums in 2021 – this is the eighth consecutive rate reduction that has been recommended.1
- Since the 2011 “reforms,” the NCCI has recommended a total 56.9 percent rate reduction for Illinois insurance premiums. Insurance companies have not followed these advised rate reductions and Illinois has no law requiring insurance companies to pass along these savings to employers.
- The biannual Oregon Workers’ Compensation Premium Rate Ranking Summary ranked Illinois as 24th in the nation for workers’ compensation premium costs in 2020. This is down 2 spots from the 2018 study.2
- Profits in the insurance workers’ compensation market in Illinois have significantly increased since 2011. In 2019 alone, insurers had a 24.8 percent profit margin and made roughly $595 million in earnings.3
- Between 2014 and 2018, Illinois experienced a 18.2 percent decrease in total benefits paid, the fourth largest decrease in the country and is most likely attributable to the changes implemented in 2011.4
- The number of new workers’ compensation cases filed in Illinois is on a steady decline, down 34 percent since 2011.5
- There are 346 insurance companies competing for and writing workers compensation insurance in our state. Illinois is second in the nation for having the most insurers writing workers’ compensation policies.6
1 National Council on Compensation Insurance. https://www.ncci.com
2 Oregon Department of Consumer and Business Services. https://www.oregon.gov/dcbs/reports/Documents/general/prem-sum/20-2082.pdf
3 National Association of Insurance Commissioners 2019 Profitability Report found at: https://content.naic.org/article/news_release_naic_releases_2019_profitability_report.htm
4 National Academy of Social Insurance. Workers’ Compensation: Benefits, Coverage, and Costs. October 2020 found at: https://www.nasi.org/sites/default/files/research/November%202020%20-%20Benefits,%20Coverage,%20and%20Costs.pdf
5 State of Illinois Workers’ Compensation Commission Annual Reports found at: https://www2.illinois.gov/sites/iwcc/about/Pages/annualreport.aspx
6 Illinois Department of Insurance 2020 Workers’ Compensation Insurance Oversight Report. https://insurance.illinois.gov/wcfu/2020-WCFU-Oversight-A.pdf
PDF Fact Sheet: Workers Compensation in Illinois