Wayne Metcalf, state insurance commissioner, yesterday approved a new rate structure that trims premiums for employers in the high-risk pool by 27.8 percent and cuts 27.3 percent off insurance costs for those not in the high-risk pool.

The rate reduction follows a state insurance division hearing Monday in which the insurance industry's representative body, the National Council on Compensation Insurance, proposed a high-risk rate reduction of 21.4 percent and a non-high-risk trim of 23.4 percent.

Metcalf argued that NCCI's calculations of insurance industry income failed to include interest income on funds held by the insurers.

Announcing the decision to lower the rates, Cayetano said that NCCI filed a lower rate structure based on Metcalf's argument.

"The amended filing will produce a larger than expected reduction in workers compensation insurance rates for Hawaii business," Cayetano said.

He said that reforms by his administration and the Legislature over the past two years have helped employers prevent injuries and improve their safety record and formed a nonprofit insurance company, the Hawaii Employers' Mutual Insurance Co., to provide coverage for employers who can't otherwise get protection.

Cayetano said the administration also has drawn up plans for a special unit in the Department of Labor and Industrial Relations to coordinate injured workers' claims for compensation.