Workers Comp Rate Cuts Can Still Raise Your Bill
NCCI's new ASB shows 2025 premium-level cuts in Alabama, Florida, and Georgia. A 0.16 EMR move on $250,000 of manual premium can still turn the renewal higher before carrier credits.
Workers comp rate cuts lower the manual rate, not the whole renewal. NCCI's 2025 ASB lists voluntary premium-level decreases of 6.1% in Alabama, 1.0% in Florida, and 3.3% in Georgia (NCCI ASB, 2025 Edition). A 0.16 EMR rise on $250,000 of manual premium adds $40,000 before credits (Orson renewal model, June 2026).
State rates can fall and your workers comp rate cuts can still feel imaginary. That is the renewal math Southeast construction CFOs have to explain this year.
NCCI (National Council on Compensation Insurance) just posted the 2025 edition of its Annual Statistical Bulletin, the 44th edition of the annual report (NCCI ASB, 2025 Edition). Exhibit 2 is the table to watch. Alabama voluntary new-and-renewal premium level fell 6.1% in 2025 (NCCI ASB Exhibit 2, 2025 Edition). Florida fell 1.0% (NCCI ASB Exhibit 2, 2025 Edition). Georgia fell 3.3% (NCCI ASB Exhibit 2, 2025 Edition). Relief, on paper.
The bill can still go up. A statewide decrease is an average input. Your renewal is a multiplication problem.
Workers comp rate cuts hit only one line
The clean version of the formula is payroll times rate times the Experience Modification Rate (EMR, also called the mod). The rate filing moves the rate. It does not move your payroll. It does not forgive a claim that is still sitting inside the experience period. It does not make a 1.12 mod behave like a 0.96.
NCCI says it plainly: "In workers compensation experience rating, the actual payroll and loss data of the individual employer is analyzed over a period of time" (NCCI ABCs of Experience Rating, 2025). That period usually covers the latest available three years of data (NCCI ABCs of Experience Rating, 2025). The statewide table is public. The worksheet is personal.
NCCI's own experience-rating primer shows the scale with a $100,000 premium before the mod: a 0.75 mod produces $75,000, a 1.00 mod produces $100,000, and a 1.25 mod produces $125,000 (NCCI ABCs of Experience Rating, 2025). Same rate base. Different employer result.
The Southeast table is average relief
The new ASB history is useful because it shows how steady the rate relief has been. Alabama's voluntary premium level fell 11.8% in 2024 and 6.1% in 2025 (NCCI ASB Exhibit 2, 2025 Edition). Florida fell 15.1% in 2024 and 1.0% in 2025 (NCCI ASB Exhibit 2, 2025 Edition). Georgia fell 4.9% in 2024 and 3.3% in 2025 (NCCI ASB Exhibit 2, 2025 Edition).
Useful, but not your invoice. A contractor can sit in a falling-rate state and still bring a worse mod, higher payroll, smaller schedule credit, or less carrier appetite into the renewal. The filing headline tells ownership what happened to the base price. It does not tell them what happened to your account.
That is the ownership answer: the rate was never the whole bill.
The 0.16 mod swing is bigger than the headline
Use the contractor example in front of us. Start with $250,000 of manual premium before the mod and before carrier credits (Orson renewal model, June 2026). A move from a 0.96 EMR to a 1.12 EMR is a 0.16-point deterioration (Orson renewal model, June 2026). On that manual premium, 0.16 times $250,000 equals $40,000 (Orson renewal model, June 2026).
Now put the rate decrease beside it. Alabama's 6.1% voluntary decrease on $250,000 is $15,250 before the mod (NCCI ASB Exhibit 2, 2025 Edition; Orson renewal model, June 2026). The 0.16 EMR deterioration is $40,000 (Orson renewal model, June 2026). Net effect: the renewal can still be $24,750 higher before carrier credits, payroll changes, deductible credits, or other policy adjustments (Orson renewal model, June 2026).
The smaller state decreases make the point faster. Florida's 1.0% decrease on $250,000 is $2,500 (NCCI ASB Exhibit 2, 2025 Edition; Orson renewal model, June 2026). Georgia's 3.3% decrease is $8,250 (NCCI ASB Exhibit 2, 2025 Edition; Orson renewal model, June 2026). A modest-looking mod change can outrun both.
In our reviews of Southeast contractor worksheets, this is the line that lands: the state rate is the weather, but the mod is the account's condition.
Carrier credits do not erase the worksheet
Carrier credits can soften the cash bill, then disappear quietly. NCCI's 2026 State of the Line showed private carrier direct written premium in NCCI states down 2.0% from 2024 to 2025, while payroll added 4.2% and loss cost and mix reduced premium by 1.2% (NCCI State of the Line, May 2026). The market is not one switch.
That is why the mod deserves its own explanation. A CFO can negotiate credits, deductibles, and payment terms. A published EMR is harder to explain away when ownership, a surety, or a general contractor asks why the number moved. The premium may be the pain. The mod is the signal.
What an audit would check
An audit checks whether the EMR applied to the lower state rate matches the file that should have been reported: payroll classifications, claim values, experience-period timing, recoveries, and current carrier records. It also tests whether the renewal explanation is being distorted by stale data rather than current risk. The goal is not to contest the state filing. It is to make sure the multiplier attached to your account is defensible.
If ownership is asking why a lower state rate did not lower the workers' comp bill, send us your NCCI worksheet and we'll review whether the mod is carrying the wrong story.