Altman urges workers’ comp insurers to reimburse small businesses for premium overpayments

Jessica Altman, Pennsylvania’s Insurance Commissioner, recently urged insurance companies that provide workers’ compensation insurance to reimburse any Pennsylvania businesses that were overcharged since April 1.

Recent increases in workers’ compensation premiums were, in some cases, tied to a data error when compiling the loss costs of insurers. Because loss costs are a factor used to set rates, some businesses renewing their policies since April 1 have experienced unjustified increases in premiums.

“If small business owners paid more than they should have for workers’ comp insurance, it’s only fair that they get refunds,” Gordon Denlinger, state director of the National Federation of Independent Business (NFIB) in Pennsylvania, said. “We are grateful to Commissioner Altman for urging a fair outcome in this dispute. Even if the data error was unintentional, we hope the insurers will do the right thing for their small business customers who were overcharged.”

The Insurance Commissioner has approved a change that will fix the error as of Jan. 1, 2019, but does not require insurance companies to reimburse businesses for the overpayments.

Altman has noted that the department continues to investigate the incident to determine whether any further department action is needed and to reduce the risk of this issue reoccurring.

“Small businesses struggle with the cost of workers’ comp insurance, and any overcharge makes the situation even worse,” Denlinger said. “That money should instead be going to recruit new employees, to build the business, or buy new equipment.”