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The Workers Compensation Insurance Rating Bureau Thursday proposed a 4.1 percent overall increase in employer-paid premiums for insurance to cover work-related injuries and illnesses, thus adding another element to the Capitol's looming battle over the multi-billion-dollar program.

The "pure premium rate" proposal would raise average costs from $2.41 per $100 of payroll to $2.51, and is markedly smaller than increases proposed by the private agency in years past.

It's contained in a letter to Insurance Commissioner Dave Jones, who will hold hearings on the issue before making his own recommendation. Insurers, however, are free to set their own rates.

Employers' workers' compensation premiums dropped sharply after the Legislature, under pressure from then-Gov. Arnold Schwarzenegger, enacted sweeping benefit and medical care reforms in 2004, but insurers have complained in recent years about rising costs, saying they were eroding profitability.

Schwarzenegger and Jones' predecessor, Steve Poizner, opposed the WCIRB's premium increase proposals, backing employers' contentions that they would retard economic recovery.

More recently, labor unions and attorneys who represent injured workers have been pressing the Legislature to undo some of the Schwarzenegger reforms, saying they are too harsh and deny legitimate compensation to disabled workers.


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