Bill > SB175

This bill mandates that insurance carriers in Colorado, including Pinnacol Assurance, must adjust an employer's experience modification factor, which is a key component in calculating workers' compensation insurance premiums, to reflect the actual amount paid for a closed claim instead of the amount paid plus any estimated future costs (reserves). This adjustment can be requested by an employer or a licensed insurance producer within a specific timeframe after a claim is reported to a rating bureau and before the employer's rating effective date. Such a modification is only permitted if an open claim was initially reported with a higher cost than its final closed amount, and if this reduction would lower the employer's experience modification factor by at least 0.05 or bring it down to 1.0 or below from above 1.0. The authorized rating organization must then update the factor within thirty days, and the insurance carrier must credit the employer for any premium changes resulting from this updated factor within the current policy period. This change is set to take effect on January 1, 2027.