Massachusetts Workers Compensation Lawyers Blog
Commissioner Michael Caljouw Nixes 7.1 Percent Hike—What It Means for Employers, Workers, and Your Injury Claim
At Jeffrey Glassman Injury Lawyers, our workers’ compensation team closely monitors every change to the Commonwealth’s workers’ compensation system, as it directly impacts the benefits our injured clients rely on. On May 15, 2025, Massachusetts Insurance Commissioner Michael Caljouw rejected a proposal from the Workers’ Compensation Rating and Inspection Bureau of Massachusetts (WCRIBMA) that would have raised average workers’ comp premiums by 7.1 percent beginning July 1, 2025. The ruling maintains current rates and is projected to save Massachusetts businesses nearly $80 million in the coming year.
A Quick Look at the Decision
- Who asked for the increase? The WCRIBMA, which files statewide rate proposals on behalf of the workers’ comp insurance industry.
- Why was it rejected? Commissioner Caljouw found the Bureau’s data and methodologies insufficient and concluded that the current rates are “not excessive” under Massachusetts law. Gen.. Laws ch. 152, § 53A.
- What happens now? Rates remain unchanged. This follows last year’s 14.6 percent rate reduction that already cut premiums for employers.
Why the 7.1 Percent Hike Failed
The Commissioner’s 43-page decision drilled into two key technical issues:
- Loss-Development Factors (LDFs). WCRIBMA relied on just two years of pandemic‐era data to project future claim costs. The Division of Insurance, the Attorney General’s Office, and the State Rating Bureau argued that a five-year window paints a far more reliable picture. The Commissioner agreed, calling the two-year approach “illogical.”
- Underwriting Profit Provision (UPP). The Bureau proposed a “premium-weighting” model, which the Commissioner stated distorted expected returns and failed to meet the comparative-risk test outlined in the landmark Federal Power Commission v. Hope Natural Gas case.
Because the Bureau bears the burden of proving rates are “not excessive, inadequate, or unfairly discriminatory,” these flaws sank the entire filing.
A Rare Alignment of Opponents
This was not a simple industry-versus-regulator fight.
- The Attorney General’s Office urged a 6.2 percent rate decrease.
- The Division’s State Rating Bureau recommended cuts of 2.1–3.1 percent for most job classes and up to 7.6 percent for federal classifications.
Commissioner Caljouw declined to order a decrease, finding that no party had proven the current rates were too high, but stressed that employers should not shoulder higher premiums without airtight justification.
What Employers Should Know
- Budget Certainty for FY 2025. With no rate change, companies can lock in workers’ compensation costs for another year, which is crucial for small businesses still recovering from pandemic-era cost spikes.
- Claims Handling Remains Unchanged. The decision affects premium dollars, not the statutory benefits available to injured employees.
- Regulatory Scrutiny Is Increasing. The Division’s deep dive into actuarial assumptions signals that future filings may face an even higher evidentiary bar.
What It Means for Injured Workers
Keeping rates where they are should not reduce the benefits you can claim if you are hurt on the job; those are defined by statute, not by insurer profit margins. However, stable premiums can make insurers less inclined to dispute legitimate claims, as their pricing already accounts for expected costs. If you encounter pushback on a claim, our firm is prepared to hold carriers to their legal obligations.
Legal Perspective: How the Decision Fits Massachusetts Workers’ Comp Law
Under M.G.L. ch. 152, rates must balance three competing goals:
- Adequate Coverage: ensuring insurers can pay all lawful claims.
- Affordability: preventing excessive costs that discourage business growth.
- Fairness: avoiding rate structures that discriminate among classes of workers or employers.
Commissioner Caljouw’s ruling reinforces that the statutory burden rests squarely on the filer (here, WCRIBMA). If the data does not demonstrate that an increase satisfies all three goals, the filing must fail. For injured workers, this oversight helps maintain a solvent system that can pay benefits when needed.
Looking Ahead
The subsequent full rate filing is expected in late 2025. Given this year’s rejection, industry actuaries are likely to revise their models to utilize longer data windows and more transparent profit calculations. Any future request for a hike will need to address the shortcomings highlighted in the 2025 decision.
Our Commitment to Massachusetts Workers
As a Boston-based firm devoted to protecting injured employees, Jeffrey Glassman Injury Lawyers applauds the Administration’s stand against unwarranted premium hikes. Fair and stable insurance costs make it easier for employers to carry the legally required coverage, and that, in turn, ensures that injured workers can access the wage replacement and medical benefits they deserve.
If you’ve been hurt on the job and have questions about how this ruling, or any other development in workers’ compensation law, affects your case, call us at (617) 777-7777 or contact us online for a free consultation. Your recovery is our priority.