How do claim costs impact my premium?
If you are a small employer, i.e. your basic tariff premium is less than or equal to $30,000, your premium will not be impacted by the costs of your workers compensation claims. However, although the premium will not be impacted by the cost of the claim, small employers are required to meet obligations as an employer under the Return to Work Guidelines and promote return to work by providing suitable duties to the injured worker.
Small employers who do not have any claims will receive 10% discount off their premium. Any small employer that has a claim, will retain the 10% discount if the injured worker is returned to pre injury employment within 13 weeks from the date of injury.
Premiums for medium employers, (employers that have a basic tariff premium greater than $30,000 but less than or equal to $500,000) and large employers (employers that have a basic tariff premium of more than $500,000) will be impacted by claims costs. This is referred to as ‘experience adjustment’. The formula used in this adjustment is calculated using an employer’s claims cost rate and their industry claims cost rate. This rewards employers that have claims costs rate lower than their industry rate as their premium will be experience adjusted down. However employers that have claims costs rate higher than their industry rate will have their premiums experience adjusted up.
For additional information, please contact a GIO consultant on 13 10 10, or visit the WorkCover NSW website.