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nccIproposesdecreaseForWclosscostsInWestvIrGInIaOnJuly182012theNationalCouncilonCompensationInsuranceNCCIdeliveredaworkersx19compensationlosscost1lingtotheWestVirginiaOf1cesoftheInsuranceCommissioner.BaseduponitsreviewofthemostrecentlyavailabledataNCCIhasproposedanoverallaverageworkersx19compensationlosscostlevelchangeof-9.1tobecomeeffectiveNovember12012.InadditionNCCIwillbe1lingax1314.3decreaseintheresidualmarketaspartoftheNovember120121ling.VoluntaryLossCostFilingComponentsImpactExperienceandTrendChangex8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8-11x83ImpactoChangeinMaximumWeeklyBenex1tx8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x80x88OsettoRefecttheImpactoApprovedItemB-1425EmployersLiabilityIncreasedLimitsx8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x80x83OsetortheChangeintheMaximumMinimumPremiumx8x8x8x8x8x8x8x8x8x8x8x8x8x8x80x80LossAdjustmentExpenseChangex8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x81x83ProposedOverallAverageVoluntaryLossCostLevelChangex3x3x3x3x3x3x3x3x3x3x3x3x3x3-9x31AssignedRiskRateFilingComponentsImpactProposedOverallAverageVoluntaryLossCostLevelExcludingLossAdjustmentExpenseChangex8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8-10x83ChangeintheAssignedRiskLossCostDierentialx8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x83x88ChangeinAssignedRiskExpensesx8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8x8-8x80ProposedOverallAverageAssignedRiskRateLevelChangex3x3x3x3x3x3x3x3x3x3x3x3x3-14x33Twoprimarydriversoftheproposedlosscostlevelchangeare1.WestVirginiaclaimsexperiencehassignix1ecantlyix11prx13vedinthex11x13strecentyear.Theexperiencebaseusedinthis1lingcalendar-accidentyears2010and2011re2ectsimprovementinworkersx19compensationexperienceversustheexperiencebaseusedinthepriorWestVirginia1lingeffectiveNovember12011calendar-accidentyears2009and2010.Thisimprovementislargelyattributabletobetterthananticipatedexperienceforcalendar-accidentyear2011butisalsoimpactedbydeclinesintheobservedlossdevelopmentfactorsbetweenthisyearx19sandlastyearx19s1lings.2.SwitchtoWestVirginia-specix1ecdataindeterminingthelx13ssAdjustx11entExpenseprx13visix13nInpriorNCCI1lingsinWestVirginiadatafromregionalstateswasemployedindeterminingthechangeinDefenseandCostContainmentExpenseDCCEwhichcomprisesamajorityoftheLossAdjustmentExpenseprovision.Withtwofullyearsofdataavailablesubsequenttotheopeningofstatex19sworkersx19compensationmarketaDCCEprovisionbasedonWestVirginia-speci1cdatawasemployedresultinginanincreaseof1.3intheprovisionforLossAdjustmentExpense.DeterminationofClassix1ecationLossCostsPriortoJuly12006ratesfor94groupcodeswerecalculatedannuallyinWestVirginia.WiththeJuly120061lingtheNCCIclassi1cationsystemwasimplementedinWestVirginiaandadvisorylosscostsfor477classi1cationsweredetermined.Duetothetransitioningtoabroaderclassi1cationsystemalongwiththeintroductionofstandardclassi1cationexceptionsNCCIwasunabletoutilizeitsstandardmethodforcalculatingclassi1cationlosscosts.ThereforeanalternativemethodologywasemployedwhichuseddatafromsevenstateslocatednearWestVirginia.Inthis1lingNCCIisimplementingitsstandardmethodologyforcalculatingclassi1cationlosscostsassuf1cientWestVirginiadataisnowavailableundertheNCCIclassi1cationplan.AspartofthetransitiontothestandardapproachNCCIhasreducedthepercentageaclassi1cationcanincreaseordecreasefromitsassociatedindustrygroupchangeto15forthis1ling.Residuax10marketIn2011theWestVirginiaresidualmarketsawsubstantialgrowth.Policycountsgrewfrom885to1325anincreaseof50.Inadditioncalendaryearpremiumgrewfrom7.4Min2010to10.4Min2011a41increase.Asaresultofacompetitivebidprocessconductedduring2011forWestVirginiatheweighted-averageservicingcarrierallowancedecreasedfrom25.42ofnetpremiumto21.21whichcontributedthebulkofthe8.0decreaseintheassignedriskexpenseprovision.overax10x10Thisistheseventhconsecutiveoverallaveragelosscostleveldecrease1ledinWestVirginiasincetheconversionfromaMonopolisticstatefundtoprivatecompetition.Assumingthis1lingisapprovedasproposedthecumulativeimpactoflosscostlevelchangessince2006willbe-40.4.page3APublicationofIndependentInsuranceAgentsofWV