On the 3rd of June, NSW WorkCover announced the latest changes designed to further improve the scheme effective 30 June 2014. A key change is an approximate 25% reduction in Industry Cost of Claims Rate (ICCR) rates. If a business has not had a similar % improvement in claims performance, then they will possibly face significant 2014/15 premium increases. Additional changes relate to maximum premium caps and extended instalment options. We recommend all medium to large businesses contact their broker or ABILITY GROUP to determine likely financial impact to their business.
NSW Workers Compensation Changes 2014 take effect 30 June 2014 and are far reaching. Contact us to discuss.
With previous changes from NSW WorkCover aimed at reducing the costs of workers compensation, the latest changes could have the opposite effect some businesses. A summary is below and please refer to the links below for further information:
1) Industry Cost of Claims (ICCR) Rate – WorkCover has reduced the ICCR rates by approximately 25%. This effectively means that if a business has a claims experience premium (i.e. >$30,000 workers compensation premium) and has not had a similar percentage improvement in claims performance, they may face material renewal premium increases. This also means it will be increasingly important for businesses to actively manage claims and our specialist Injury/Claims Management Services will assist.
2) Maximum Premiums – have now been introduced for all employees, with now 6 capping levels. For companies with wages >$500,000 the capping is 3 X Tariff (Base Tariff Premium).
3) Grouping Threshold – The wages threshold for grouping has now been lifted from $500,000 to $750,000. This change is aligned to the Office of State Revenue’s payroll tax threshold
4) Extended Instalment Option – NSW WorkCover has introduced a new 3 month instalment option for adjustment premiums more than $1,000. This is designed to assist with business cash flow and will alleviate financial pressures for some businesses. It should be noted however that this is only available for adjustment premiums renewing on or after 30 June 2014. This means that businesses that renew on 30 June 2014 will miss this option until the following year
5) Actual Wages Declarations – the time frame available to report actual wages has been extended from 2 to 4 months after policy expiry. For policies renewing 30 June 2014, actual wages will be due to the insurer by 31 October 2014.
Additional information can be found below:
Source: NSW WorkCover
Read Time: < 2 Minutes
Source: NSW WorkCover
Title: Premiums rates (IPO)
Read Time: 2 Minutes