State Of Oregon Proposes Workers’ Compensation Rates For 2027 (Photo) - 09/09/26

Salem – On average, Oregon employers will pay 92 cents per $100 of payroll for workers’ compensation coverage in 2027 under a proposal the Oregon Department of Consumer and Business Services (DCBS) announced today. The rate would be the second lowest on record.

The pure premium rate would increase by an average 2.1 percent under the proposal. Pure premium is the base rate insurers use to determine how much employers must pay for medical costs and lost wages. Despite the increase, the pure premium per $100 of payroll will have declined by 36.5 percent from 2018 to 2027.

The increase to the average pure premium rate would contribute to an increase in the average cost of workers’ compensation coverage, from 89 cents per $100 of payroll in 2026 to 92 cents per $100 of payroll in 2027. This figure is referred to as loaded pure premium and includes pure premium, insurer profit and expense factors, and assessments paid by employers.

The rise in Oregon’s average pure premium rate is due to benefits for workers injured on the job being increased through Senate Bill 1519 (2026), which modified weekly lost-time wage compensation benefits for workers with disabling claims. The bill is intended to elevate benefits for lower wage earners who are injured on the job. Under current law, temporary total disability benefits are paid at 66 2/3 percent of the state average weekly wage (SAWW). Effective Jan. 1, 2027, the weekly compensation rate for wages up to 75 percent of the average weekly wage will increase to 75 percent, while the compensation rate for wages more than 75 percent of the SAWW will decrease to 65 percent.

Long-term declines in lost-time claim frequency continue to help offset upward pressure on system costs from higher medical and indemnity claim severity seen across the country, as well as benefit increases such as those made by Senate Bill 1519, according to the National Council on Compensation Insurance (NCCI). NCCI is the U.S. rate-setting organization whose recommendation DCBS reviews as part of its annual public process to decide rates.

The 2.1 percent increase in the pure premium is an average, so an individual employer may see a larger or smaller increase, no change, or even a decrease, depending on the employer’s industry. Also, an employer’s premium is affected by factors other than changes in pure premium rates, such as the employer’s payroll, modifications based on its claim experience, and its insurer’s profit and expense factor.

The increase in the pure premium will be effective Jan. 1, 2027, but employers will see the changes when they renew their policies for 2027.

Employers’ total cost for workers’ compensation insurance also includes a premium assessment. In addition, employers pay at least half of the Workers’ Benefit Fund (WBF) component and the Oregon Bureau of Labor and Industries (BOLI) Expense Fund component, which are cents-per-hour-worked rates.

The premium assessment, which is a percentage of the workers’ compensation insurance premium employers pay, is added to the pure premium. It would remain at 9.8 percent in 2027, the same as 2026, under the DCBS proposal. In fact, 2027 would mark the sixth-straight year the premium assessment remained at 9.8 percent.

The premium assessment funds the successful programs of Oregon’s workers’ compensation system, including the Workers’ Compensation Division; Oregon OSHA; the Workers’ Compensation Board, which resolves disputes over the state’s workers’ compensation and workplace safety laws; the Ombuds Office for Oregon Workers, an independent advocate for workers on workers’ compensation and workplace safety and health; and the Office of the Small Business Ombudsman for Workers’ Compensation, an independent advocate for small businesses, entrepreneurs, and the professional advisers who serve them.

Meanwhile, the WBF assessment funds return-to-work programs, provides increased benefits over time for workers who are permanently and totally disabled, and gives benefits to families of workers who die from workplace injuries or diseases.

The fund’s revenue comes from a cents-per-hour-worked assessment. The assessment would increase to 2.2 cents per hour worked in 2027. It would be the fourth-lowest rate since the inception of the cents-per-hour assessment in 1996.

New for 2027 is the establishment of the BOLI Expenses Fund (BEF) component, created by House Bill 4027 (2026). DCBS is collecting that component to help fund BOLI. In 2027, DCBS will collect 0.2 cents per hour worked for the fund.

The addition of the BEF component combined with the WBF component results in a total assessment of 2.4 cents per hour worked.

Oregon’s workers’ compensation premium rates have ranked favorably compared to other states for many years. Oregon had the nation’s 14th least expensive rates in 2024, according to a nationally recognized biennial study conducted by DCBS.

The public hearings for the premium assessment and the WBF assessment are Thursday, Sept. 17, at 3 p.m. and 4 p.m., respectively.

Written testimony will be accepted through 5 p.m. Thursday, Sept. 24, by the Director's Office of DCBS, P.O. Box 14480, Salem, OR 97309-0405.

The DCBS website has a table showing the workers’ compensation cost summary for 2027 and more information about Oregon workers’ compensation costs.

The loaded pure premium includes insurer costs, known as expense loading factors. Historic figures are adjusted to reflect the 2026 mix of employment and payroll.

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About Oregon DCBS: The Department of Consumer and Business Services is Oregon’s largest consumer protection and business regulatory agency. The department administers state laws and rules to protect consumers and workers in the areas of workers’ compensation, occupational safety and health, financial services, insurance, and building codes. Visit dcbs.oregon.gov.