Massachusetts authorities said businesses will see their workers’ compensation premiums drop by an average of 2.4 percent, instead of a 4.2 percent increase that insurers had sought.

Attorney General Martha Coakley announced the deal with insurers Tuesday, saying the agreement will save businesses an estimated $75 million compared to what they would have spent if the rate increase was approved.

Coakley’s office had argued for the lower rate.

Workers compensation insurance rates are set every other year after a hearing before the Division of Insurance.

Gov. Deval Patrick said the lower rates are in keeping with the administration’s goal of improving the state’s business climate. He said it is the 10th reduction in workers’ compensation rates since 1994.

The new rates go into effect Sept. 1.