Following months of industry speculation, as many have predicted NSW workers compensation premiums will be increased from 1.4% of wages to 1.44% of total NSW wages in the 2021-22 financial year. With the icare run NSW workers compensation scheme having been in media headlines, this announcement comes as no surprise. So what does it mean for your business?
Although it appears to most as a small percentage increase, by increasing NSW premiums to be 0.4% (from 1.4% to 1.44%) more of NSW wages, it will have a material increase to workers compensation premiums payable by NSW businesses. NSW workers compensation premiums will consequently increase over the next 2 financial years with icare proposing a 2.9% premium increase each year or close to 6% over the 2 year period.
Icare identifies the intention of the staggered premium increases is to reduce volatility for NSW businesses as they recover from the impacts of COVID-19, while also focusing on the NSW workers compensation schemes sustainability in the long-term. Many have argued that mis-management has resulted in the scheme bleeding money that if managed correctly could have minimised business premium increases or eliminated them entirely.
Many businesses are yet to recover to pre-COVID levels and in conjunction with JobKeeper ending, it will be interesting to observe what happens to ongoing viability of businesses with NSW workers compensation premiums now also increasing. icare CEO Mr Harding says the increase (in premiums) will be accompanied by a commitment to lifting icare’s performance and a reduction in internal costs – which no doubt will be a relief to impacted businesses.
During difficult economic times, workers compensation claims can spike and therefore for claims experience rated business ($30,000 premiums) higher premiums also leads to the higher maximum premiums payable.
Need help reducing your workers compensation premium? Contact our workers compensation specialists for assistance.
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Source: insurancenews.com.au
Title: NSW workers’ comp premiums set to rise
Read time: 2 minutes
Source: icare
Title: Workers compensation premiums adjust to future risks
Read time: 5 minutes