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The LMCIT Board of Trustees evaluates claim projections every year to ensure premium rates are adequate. The following provides information about premium rates going into effect for property/casualty and workers’ compensation coverages renewing on or after Jan. 1, 2025.
Property/casualty rates
In addition to the various rate changes, there will be adjustments to LMCIT’s deductible pricing schedule in 2025 and an increase to the minimum deductible option from $250 to $500 in 2026. More information is included in this section.
What are property/casualty rate changes for 2025?
Rates will decrease by an average of 6.5%, which consists of the following:
- Liability rates will decrease 8%.
- Property rates will decrease 8%.
- First party cyber rates will decrease 8%.
- Equipment breakdown (optional coverage) rates will decrease 8%.
- No rate changes for all other lines of coverage.
Will my premiums decrease by these amounts?
No. Rates are only one piece of the puzzle for premium calculations. Changes in exposure — such as property values, auto and employee counts, and annual expenditures — as well as changes in experience rating will also impact a member’s renewal premium.
Contact LMCIT’s underwriting staff for questions about member-specific premium calculations.
Why are rates changing?
A combination of factors are allowing LMCIT to decrease rates:
- Claim cost projections for 2025 are lower than for 2024 due to members’ improving loss patterns.
- Favorable renewal pricing from LMCIT’s reinsurance partners.
- An increase in investment revenue expectations due to changes in market conditions as well as changes in how LMCIT’s investment portfolio is structured.
Because of these positive results, LMCIT will also be returning a dividend to members of the property/casualty program. Learn more about the $3 million dividend.
What’s happening with LMCIT’s deductible options and pricing schedule?
Members have the flexibility to decide the amount of risk they want to retain when property, liability, and auto claims happen. This comes in the form of a per occurrence deductible. After a thorough actuarial study, deductible options will change as follows:
- For coverages renewing on or after Jan. 1, 2026, the minimum deductible option will increase from $250 to $500.
- Based on the deductible level chosen by the member, LMCIT applies a credit that’s intended to be offset by the resulting reduction in claim costs for which LMCIT will be responsible. The deductible credit schedule will be adjusted for coverages renewing on or after Jan. 1, 2025, by separating the schedule for liability/property and auto liability/auto physical damage. The change is not projected to impact any individual members’ total premium by more than 3%.
Table: Comparison by deductible level of old deductible credit and new deductible credit for auto and property/liability coverage
Deductible Level | Old Deductible Credit | New Deductible Credit — Auto | New Deductible Credit — Property/Liability |
|---|---|---|---|
500 | 3.5% | 2.2% | 0.5% |
1,000 | 6.0% | 6.2% | 1.4% |
2,500 | 11.5% | 15.9% | 7.1% |
5,000 | 17.0% | 21.2% | 12.9% |
10,000 | 24.5% | 28.3% | 20.7% |
15,000 | 30.0% | 33.5% | 26.5% |
20,000 | 34.0% | 37.3% | 30.7% |
25,000 | 37.5% | 40.6% | 34.4% |
50,000 | 48.0% | 50.6% | 45.4% |
75,000 | 54.0% | 56.3% | 51.7% |
100,000 | 57.0% | 59.2% | 54.9% |
200,000 | 64.5% | 66.3% | 62.7% |
300,000 | 68.0% | 69.6% | 66.4% |
150,000 | 60.7% | 62.7% | 58.7% |
Workers’ compensation rates
In addition to the rate changes, the nonsmoking credit for police and fire job classes will be eliminated for 2025. LMCIT began phasing out the credit in 2024, when it decreased from 10% to 5%.
What are the rate changes for 2025?
Rates will decrease by an average of 20%. That consists of the rate adjustments by job class, shown in the table below. LMCIT performs a detailed analysis every three years to verify rates are properly aligned with loss cost expectations for each job class.
For a member with a typical mix of payrolls, class increases and decreases will largely offset each other and result in a rate change that is close to the average 20% rate decrease. However, a special purpose entity with most of its payroll in one or two classes could see a bigger effect. Rates for individual classes are capped at an increase of no more than 25% and a decrease of no more than 45%.
Members and agents can contact their underwriter for member-specific details.
Table: Job class rate relativity adjustments effective Jan. 1, 2025
The following table details 2025 job class rate changes for the bulk of city payrolls.
- Most job class rates are shown per $100 of payroll.
- Rates for volunteer firefighters are shown per 100 of population.
Job Class Code | Job Class | 2024 Rates | 2025 Rates | Rate Change |
|---|---|---|---|---|
5506 | STREET CONSTRUCTION | 8.21 | 4.51 | -45.0% |
7380 | DRIVERS & HELPERS | 5.63 | 4.60 | -18.4% |
7381 | VOLUNTEER AMBULANCE SERVICE | 9.48 | 5.58 | -41.2% |
7502 | GAS COMPANY | 7.07 | 3.89 | -45.0% |
7520 | WATERWORKS | 3.45 | 2.57 | -25.7% |
7539 | ELECTRIC & STEAM PLANT | 2.99 | 1.85 | -38.0% |
7580 | SEWAGE DISPOSAL PLANT | 4.14 | 2.28 | -45.0% |
7706 | FIREFIGHTERS (NOT VOL) | 8.87 | 7.61 | -14.2% |
7708 | FIREFIGHTERS (VOL) | 225.19 | 202.98 | -9.9% |
7716 | FIREFIGHTERS (NOT VOL) NON-SMOKING | 8.48 | 7.61 | -10.2% |
7718 | FIREFIGHTERS (VOL) NON-SMOKING | 215.34 | 202.98 | -5.7% |
7720 | POLICE | 8.86 | 7.72 | -12.9% |
7721 | POLICE NON-SMOKING | 8.48 | 7.72 | -8.9% |
7722 | POLICE RESERVES | 3.10 | 3.88 | 25.0% |
8017 | OFF SALE LIQUOR STORE | 3.60 | 1.98 | -45.0% |
8227 | CITY SHOP & YARD | 3.86 | 4.12 | 6.7% |
8810 | CLERICAL OFFICE EMPLOYEES | 0.64 | 0.41 | -36.0% |
9015 | BUILDINGS-OPER BY OWNER | 6.41 | 3.53 | -45.0% |
9033 | HOUSING AUTHORITY-ALL EMPLOYEES | 3.49 | 3.00 | -14.0% |
9060 | CLUB-COUNTRY/GOLF | 1.53 | 1.91 | 25.0% |
9063 | COMM. CENTERS-ALL EMPLOYEES | 2.26 | 1.43 | -36.6% |
9084 | ON SALE LIQUOR STORE | 3.68 | 2.17 | -41.0% |
9102 | PARKS | 6.72 | 5.50 | -18.2% |
9182 | CITY ARENA-OPERATIONS | 3.72 | 3.57 | -4.1% |
9403 | GARBAGE OR REFUSE COLLECTION | 7.84 | 5.99 | -23.7% |
9410 | MUNICIPAL EMPLOYEES | 0.81 | 0.76 | -5.9% |
9411 | ELECTED OR APPOINTED OFFICIALS | 0.44 | 0.55 | 25.0% |
Will my premium decrease by this amount?
No. Rates are only one piece of the puzzle for premium calculations. Changes in payroll exposure by job class as well as changes in experience rating will also impact a member’s renewal premium.
Why are rates changing?
The primary reason for the average 20% rate decrease is because of favorable claim development, both on new claims received by LMCIT in 2023 and 2024, and on case reserves for older claims. The favorable claim development was especially pronounced for Post Traumatic Stress Disorder (PTSD) claims and medical costs for other claims.
In recent years LMCIT has communicated with members about a legislative change in 2019 that made PTSD presumptively work-related for public safety personnel. Premium rate increases were necessary because these claims became a significant portion of LMCIT’s costs. Recent favorable development on both PTSD and non-PTSD claims have changed the trend assumptions used to project future claim costs, allowing for an overall reduction in many job classes. In addition, these improved trends have enabled LMCIT to return a dividend to members of the workers’ compensation program. Learn more about the $5 million dividend.