In the last 12 months, the NSW workers compensation industry has experienced dramatic change. As we approach 30 June 2016, it should be relieving for businesses to know that for there are no changes for workers compensation WorkCover Industry Classification (WIC) rates. As 2016/17 rates for NSW Workers Compensation apply to all renewals that fall due at 4pm on 30th June 2016, businesses and brokers will now be receiving renewal notices for these policies without fear of rate driven increases.
For large employers, icare however announced changes to the Retro Paid Loss (RPL) model by introducing Loss Prevention & Recovery (LPR) scheme as the replacement. LPR is progressively moving closer to providing pricing similar to that of insurers in privately underwritten schemes. This is an important change for large business.
No Rate Changes, But LPR Replaces RPL – The 2016 rates for NSW Workers Compensation have been applied to all renewals that fall due 30th June 2016. Brokers and their customers will now be receiving renewal notices for these policies. Key updates applicable to the 2016/17 policy period:
- There is no change to WIC rates
- Performance discounts have been provided for hindsight adjustments. This adjustment was implemented as part of the Reforms Project and is an adjustment to a customer’s premium based on the performance of the Scheme overall
- CPI changed from 1.6% to 1.7%
- Mine Safety Levy has changed from 1.177% to 0.743%
- Medium and Large (experience rated) employers who have held a NSW policy for less than 12 months will have a premium equal to Basic Tariff Premium (BTP) with no discount or loading for claims history
- Transitional capping will continue to cap at a 30% increase and approval via ICare
In addition for large employers, iCare NSW has announced a revitalised RPL model renamed as the Loss Prevention and Recovery (LPR) scheme. It is progressively moving closer to providing pricing similar to that of insurers in privately underwritten schemes. This LPR method is an alternative method to the traditional conventional model of calculating premiums payable by large employers. Rather than wages, premiums are calculated based on employers claims costs each year. This method of premium calculation provides the incentive to improve workplace safety and outcomes for injured workers by offering more immediate financial rewards for loss prevention and recovery at work. Under this method, the premiums payable by large employers more closely reflect their individual experience. To enter into this model requires analysis and understanding of the full commitment, ABILITY GROUP can help you understand if this is right for your business. Please let us know if you would like help further understanding and assessing the opportunity for your business.
Title: 2016/17 Rates & Changes
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Please contact ABILITY GROUP if you would like assistance with your premium or understanding how these changes could benefit your business.