Declining Frequency, Severity Drive 5% Rate Cut

Declining frequency and average claim severity in New Mexico helped drive a 5% rate cut for 2019, according to the National Council on Compensation Insurance’s State Advisory Forum. Frequency dropped by 9.3% in 2016, following a 4% drop the previous year. The number of claims filed each year in New Mexico has been declining or flat since 2007. The average cost of an indemnity claim also dropped over each of the two most recent years for which NCCI has data. Average severity fell 4.3% in 2016, to $25,100 from $26,200 in 2015. The average severity in 2015 was 7.5% lower than the pre...