On February 27, 2026, the Texas Department of Insurance issued Commissioner’s Bulletin B-0001-26, accepting NCCI advisory loss cost filing NCCI-134745334 (State Tracking S734384) with a July 1, 2026 effective date. The filing proposes an overall average 3.8% decrease to the current Texas workers compensation loss costs.
That is a useful reserve benchmark. It is not, by itself, a reason to release unpaid claim reserves.
The distinction matters because advisory loss costs are not rates. TDI’s July 1, 2026 advisory loss cost table says the figures exclude all expense provisions except loss adjustment expense. The Texas workers’ compensation rate guide explains the bridge from loss cost to insurance price: a carrier multiplies the class loss cost by its loss cost multiplier, which loads for items such as commissions, profit, and taxes. A self-insured employer does not carry that manual premium, but it often uses the same bureau loss-cost direction as an external check on the expected claim ratio in a Bornhuetter-Ferguson reserve indication.
Who it affects
The immediate audience is Texas-heavy self-insured employers, large deductible buyers, group self-insurance programs, and captives with workers compensation payroll concentrated in construction, manufacturing, healthcare, energy services, public entities, and logistics. Multi-state employers should isolate the Texas accident-year slice instead of blending the filing into a countrywide workers compensation reserve pick.
The class-code mix can matter more than the statewide average. TDI’s July 1 table lists code 5551 (roofing) at a 1.946 advisory loss cost per $100 of payroll, while code 8810 and the new 8871 clerical or telecommuter code appear at 0.020. An employer concentrated in a few high-hazard classes should not assume it receives the statewide 3.8% signal in its own exposure base. The relevant question is whether its dominant classes moved with the statewide decrease, not whether the headline number went down.
The reserve mechanism
The reserve lever is the expected claim ratio for the current and next accident year. If an actuary used prior Texas advisory loss costs as one input to the expected-loss pick, the July 1 filing gives a fresh external prior. It can support a lower selected ratio for immature Texas years if the employer’s own frequency, payroll, and severity experience point the same way.
It should not automatically change open-claim case adequacy, tail factors, or medical development assumptions. NCCI’s 2026 State of the Line presentation gives the caution: workers compensation claim frequency fell 2% in 2025, but medical and indemnity severity each rose 4%. A lower loss-cost level can coexist with positive severity trend, especially when payroll growth and declining frequency carry the filing. That is why the filing is a starting prior for future accident years, not proof that older lost-time or lifetime medical claims are overreserved.
For large Texas programs, this belongs next to the workers compensation IBNR triangle, not in a premium-only renewal memo. Compare paid medical severity, reported lost-time counts, average weekly wage mix, and class-code payroll shifts at the next valuation. If those diagnostics conflict with the bureau decrease, the employer-specific evidence should control.
What this means for your next review
Put three items on the reserve agenda: how much of the Texas expected loss pick comes from external loss costs, whether dominant class codes moved with or against the statewide 3.8% decrease, and whether the filing changes only the current-year expected claim ratio or also any selected development pattern. If your report does not show that bridge clearly, use the actuary report evaluation guide to ask for the reconciliation in plain English.
Sources
- Texas Department of Insurance, Commissioner’s Bulletin B-0001-26, https://www.tdi.texas.gov/bulletins/2026/b-0001-26.html
- Texas Department of Insurance, Texas workers’ compensation rate guide, https://www.tdi.texas.gov/wc/regulation/rcomp.html
- Texas Department of Insurance, Texas advisory loss costs effective July 1, 2026, https://www.tdi.texas.gov/WC/regulation/documents/2026txlosscosts.pdf
- NCCI, 2026 State of the Line presentation, https://www.ncci.com/Articles/Documents/AIS2026-SOTL-Presentation.pdf
- NCCI, Anticipated effective dates by state, https://www.ncci.com/Articles/Documents/II_Anticipated-Effective-Dates-State.pdf
- actuary.info, Texas Workers Comp Loss Costs Drop 3.8% as New Telecommuter and Remediation Classifications Take Effect July 1, https://actuary.info/insights/texas-wc-loss-cost-drop-remote-class-code-pricing-2026