CALIFORNIA GEARS FOR RISE IN COMP COSTS

CALIFORNIA GEARS FOR RISE IN COMP COSTS

After declining for two years, the cost of providing workers compensation coverage is expected to jump this year, state officials said.

The cost of caring for employees hurt on the job in California will be up 11.3 percent for 1995, the California Department of Insurance said in a new analysis.The advisory report suggests that employers are likely to face higher premiums when their annual workers compensation policies are renewed.

Crackdowns on fraud and abuse, along with other measures, brought down rates by an estimated 41 percent since January 1993, said Insurance Commissioner Chuck Quackenbush.

Barry Carmody, president of the Association of California Insurance Companies, blamed workers compensation increases on bureaucratic delays in the Division of Workers Compensation, the state agency that administers disputed claims.

"While injuries aren't up significantly, the cost of administering them is, and that's scary," Mr. Carmody said.

Frank Floyd, a spokesman for the State Compensation Insurance Fund, the state's biggest workers compensation insurer, agreed generally with the insurance department's finding.

Renewed inflation of medical costs for diagnosing and treating injured workers have begun driving prices back up, Mr. Floyd said. At the same time, insurance companies and prosecutors may be devoting less attention to workers compensation abuse, he said.