The massively hyped workers comp reform strongarmed by Gov. Schwarzenneger in California was supposed to reduce rates. Instead, many businesses find their rates have increased.
Why? Insurance carriers, in a sleazy move, are reclassifying workers into higher risk categories, that’s why.
From a preschool operator:
“It went from $22,000 to $32,000,” Behravesh says. “I’ve never had an increase like that.”
Khokha discovered that her employees had been reclassified by her insurance company even though they performed the same jobs this year as they did in previous years. They went from early childhood educators to day-care workers, a switch that put them in a higher premium category.
From Insurance Commissioner John Garamendi
“Often it makes no sense whatsoever, and we are constantly dealing with this issue,” he added, citing an example of an insurance company that classified secretaries as heavy equipment operators.
In a bizarre happenstance, the Insurance Commissioner has no authority to order insurance companies to stop these greedy pig classification changes. We knew you”d be shocked to hear this.