Pinnacol Assurance, Colorado’s last‑resort workers’ compensation insurer, announced on May 14 that it would lay off 43 employees, roughly 7.5% of its 578‑person workforce. the cuts come as the agency grapples with shrinking market share and a long‑standing debate over whether to privatize the entity.

43 Workers Cut, Representing 7.5% of Staff

The layoffs were executed across the organization and were described by spokesperson Liz Johnson as a "proactive measure" to refine operations and safeguard the agency’s financial future.. johnson’s statement emphasized gratitude for the departing staff and pledged support during the transition,echoing language from an internal memo that highlighted Pinnacol’s "extremely strong" financial foundation.

Pinnacol’s Market Share Fell to 49% Since 2015

Since holding about 60% of Colorado’s workers’ comp market in 2015, Pinnacol’s share has slipped to 49% in 2024, according to the agency’s internal data. The decline is linked to the rise of multi‑state employers, which limits Pinnacol’s pool of eligible clients to businesses operating solely within Colorado.

Privatization Push Stalls After $150 Million Ballot Measure Fails

Governor Jared Polis has included privatization of Pinnacol in his last two budget proposals, but a November ballot initiative to spin off the agency and allocate $150 million for workforce development was abandoned. A joint statement from Pinnacol, the Colorado Building and Construction Trades Council, the International Brotherhood of Electrical Workers local chapter, and the nonprofit Colorado Succeeds confirmed the measure would not move forward.

Labor Groups Warn Private Insurance Could Raise Rates

Labor representatives argue that a private Pinnacol would likely increase premiums, especially for high‑risk sectors such as construction, potentially leaving some firms unable to afford coverage. Scott Laband, CEO of Colorado Succeeds, called Pinnacol a "cornerstone" of the state’s economy and urged a "smarter, more unified solution" instead of outright privatization.

What Will Replace the Laid‑off Roles?

The internal memo assured employees that no further layoffs were planned, but it did not specify how the remaining duties would be redistributed or whether automation would play a larger role.. As the agency seeks efficiency, the exact nature of the new workflow remains unclear.