Actuarial calculations indicate a need for a 6.3 percent rate increase because of medical inflation and other factors, the department said in a statement. But the increase will be limited to 3 percent because "we recognize the difficult economic environment for business and workers and wanted to limit the increase as much as possible," director Judy Schurke said in the statement.

Lowering the premium increase to 3 percent from 6.3 percent will result in an expense shortfall of $62 million, which will be absorbed by a contingency reserve, the department said.

(Read related stories "North Carolina Approves Comp Rate Decrease," "Florida Approves Comp Rate Decrease" and "California Comp Rate Increase Is Approved.")

—Roberto Ceniceros/Business Insurance
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—Crain's Benefits Outlook, December 2008