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Workers’ Comp Insurance Rates Are Down

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Workers’ Comp Rates Are Down: A 10-Year Look at What’s Changed and What It Means for Your Business

Business owners looking at growth and safety metrics in a professional office

For most business owners, opening an insurance renewal notice usually feels like preparing for bad news. In an era where the cost of everything from raw materials to office rent seems to be climbing, there is one major exception that might surprise you: workers’ compensation.

Over the past decade, workers’ compensation has become a rare bright spot in the commercial insurance landscape. While other lines of coverage like commercial auto or property insurance have seen significant price hikes, workers’ comp rates have been on a steady, decade-long decline.

If you haven’t reviewed your policy recently, you might be paying significantly more than the current market requires. Let’s take a look at the data behind this trend and how your industry is being affected.

A Decade of Declining Costs: The Data

The trend isn’t just a local fluke; it is a sustained national shift. Since 2016, the workers’ compensation market has remained “soft,” meaning there is plenty of competition among carriers and lower prices for you, the policyholder.

According to the National Council on Compensation Insurance (NCCI), 2026 marks the 13th consecutive year of loss-cost declines. This is a historic run that has fundamentally changed the financial outlook for many businesses. Here are the numbers you need to know:

  • 2024 Performance: Premiums fell by an average of 3% year-over-year.
  • The Combined Ratio: This is a measure of profitability for insurance companies. The industry’s combined ratio held steady at 86, marking the 8th straight year it has remained below 90. Essentially, for every dollar insurers take in, they are only paying out 86 cents in claims and expenses, leaving them plenty of room to lower rates for you.
  • Claim Frequency: In 2024 alone, lost-time claim frequency dropped by another 5%. Simply put, employees are getting hurt less often and returning to work faster.

The Texas Perspective

For our local partners right here in Texas, the news is even better. Texas saw a 3.8% loss cost decrease effective July 2026. This means the baseline cost of insurance: before a carrier adds their overhead: is significantly lower than it was just a few years ago.

Why You Need Workers’ Comp (And What Happens When You Don’t Have It)

Workers’ compensation is designed to protect both your employees and your business. When someone gets hurt on the job, workers’ comp can help cover their medical bills and a portion of their lost wages while they recover. That support matters for the injured employee, but it also matters for you as the employer because it creates a clear system for handling workplace injuries.

If you do not have workers’ comp and an employee gets injured, you may be responsible for the full cost of medical treatment and lost wages out of pocket. In Texas, where workers’ compensation is optional for most private employers, choosing to be a non-subscriber comes with serious risk. If an injured employee sues, you can face unlimited civil liability related to that workplace injury.

Just as important, there is real peace of mind in knowing your team is taken care of and your business assets are better protected. For many owners, workers’ comp is not just about meeting a requirement or checking a box. It is about protecting the people who keep your business running and reducing the financial risk a single accident can create.

Why Are Rates Dropping So Consistently?

You might be wondering: “If everything else is more expensive, how is workers’ comp getting cheaper?” It isn’t magic; it’s the result of a massive shift in how businesses operate and how technology is used on the job.

1. The Tech Revolution

Technology has moved from the office desk to the warehouse floor and the truck cab. The use of Electronic Logging Devices (ELDs) in transportation has drastically reduced driver fatigue and accidents. In manufacturing, automation and robotics have taken over many of the high-risk, repetitive tasks that used to lead to back injuries and lost limbs.

2. A Culture of Safety

Businesses are smarter about safety than they were ten years ago. It’s no longer just about wearing a hard hat; it’s about comprehensive safety programs and “Return-to-Work” initiatives. These programs ensure that if an employee is injured, they have a clear path back to light-duty work, which keeps claim costs from spiraling out of control.

3. Construction Leads the Way

Construction workers using technology to enhance safety on site

Perhaps the most impressive shift has been in the construction industry. Between 2015 and 2022, claim frequency in construction dropped by a staggering 26%. To put that in perspective, all other industries combined saw a 15% drop in the same period. The “safety first” mentality on job sites is paying real dividends in the form of lower premiums for contractors.

Industry Breakdown: What Should You Be Paying?

While every business is unique, insurance carriers use classification codes to determine your base rate per $100 of payroll. Depending on your industry, you might notice a wide range of pricing.

Automated manufacturing facility highlighting safety and efficiency

Top Workers’ Comp Carriers and How to Reach Them

Because the market is so competitive right now, it pays to know who the major players are. Below is a list of top-rated carriers that Trutela works with to find the best rates for our clients.

  1. Nationwide
  3. The Hartford
  5. Liberty Mutual
  7. Progressive Commercial
  9. Acuity Insurance
  11. Travelers
  13. Texas Mutual
  15. Trutela Insurance (Your Independent Advocate)
    • Website: www.trutela.com
    • Phone: (210) 757-4520
    • Expert Contact: Joseph Gutierrez, CIC

Medical professionals in a clean healthcare setting discussing patient care

Payment Options: Find What Works for Your Cash Flow

Workers’ comp does not have to feel like a once-a-year financial hit. Most carriers offer flexible payment options depending on the carrier and your business needs, which gives you more control over how premium payments fit into your budget.

  • Pay in Full: This is the traditional option. You pay the entire annual premium upfront, and some carriers may offer a small discount because they receive the full payment at once.
  • Monthly EFT: This option spreads your premium into monthly installments through electronic funds transfer. It can make cash flow easier to manage, although some carriers may charge small installment fees.
  • Pay as You Go: For many business owners, this is the modern standard. Instead of paying based on estimated annual payroll, Pay as You Go connects to your payroll system. Each time you run payroll, your workers’ comp premium is calculated and deducted using actual payroll data. The biggest benefit is accuracy. Because your premium is tied to what you actually paid employees, you can avoid the surprise audit bill that often shows up when payroll estimates were set too low. It is a more transparent approach that helps keep cash flow predictable.

How to Capture These Savings

Knowing that rates are down is one thing; actually seeing those savings on your bottom line is another. Because rates are dropping, a policy you’ve had for three or four years might now be significantly overpriced.

At Trutela, we are an independent agency. This means we don’t work for the insurance companies: we work for you. We shop your coverage across all the top-rated carriers listed above (and many more) to see which one is currently offering the most aggressive rates for your specific industry.

As your trusted advisors, we help you navigate the complex landscape of “mods” (Experience Modifier Rates) and safety credits to ensure you aren’t just getting a lower rate, but the proper protection.

Your Next Steps

  1. Check your “Mod” score: If it’s above 1.0, you’re paying a penalty. If it’s below, you’re getting a discount. We can help you lower this over time.
  2. Audit your payroll: Ensure you aren’t over-reporting or misclassifying employees in higher-risk categories than necessary.
  3. Get a fresh comparison: The market has changed more in the last 24 months than it did in the previous five years.

Don’t let your workers’ comp policy sit on autopilot while the rest of the market enjoys historic lows. Contact us today for a comprehensive review of your commercial coverage.

Insurance advisor reviewing options with a client in a professional office