Calculating the cost of your workers insurance premium

Your workers compensation insurance premium is based on your industry, how much you pay in annual wages, and a range of other factors.

Every business faces different types of risk, which is why we apply a premium rate based on the industry you work in.

All premiums are calculated by taking your industry classification rate and multiplying it with how much your business pays in wages. This is called average performance premium.

If that number is $30,000 or less, you’re considered a small employer and your premium remains unaffected by claims costs if a worker is injured.

If your average performance premium is over $30,000, you’re considered a medium to large employer and your premiums are experience-rated. This means your premium will be impacted by your claims performance.

To help keep premiums affordable, we offer a range of incentives and discounts to businesses that demonstrate a strong safety record and commitment to helping injured workers return to work.  

If you're a new customer get a quick quote or take out a policy

Understanding industry classifications 

When you apply for a workers compensation insurance policy, you are required to give details of your business activities. This helps us allocate a Workers Compensation Industry Classification (WIC) for your business.

If you have multiple separate and distinct business activities, the average performance premium formula (wages x WIC rate) is repeated for each applicable industry class, and the outcomes added together to produce the total average performance premium.

Declaring your wages

All businesses with conventional policies must declare their wages annually to icare to ensure they are paying the correct premium.

This is done by filling out the wages declaration form.

You are required to lodge a declaration at the end of your workers compensation insurance policy period.

Learn more about declaring your actual wages

Factors in claims performance

As an experience-rated employer, your premiums may be affected as the result of a claim.

Your claims performance is calculated at the renewal date of your policy and includes your claims costs for the three years prior to commencement of the policy period.

Your claims performance rate (CPR) rewards you with a lower premium if you have a good record of managing worker safety and recovery at work.

Your CPR is calculated by comparing your claims performance with other NSW businesses.

If your claims performance is better than the Scheme average, then your premium will be lower than your average performance premium.

Your claim costs will be the same for both your initial and hindsight premium calculations. This means the hindsight premium calculation will not include the claims incurred during the policy period.

Claims costs included in experience premium

Certain claims costs are included in the premium calculation, while other claims costs do not impact premium.

Premium impacting costs include:

  • Weekly compensation
  • Provisional weekly compensation
  • Permanent impairment
  • Commutation payments
  • Common law compensation

Costs that don’t impact premium include:

  • Journey claims
  • Recess claims
  • Health provider costs
  • Hospital and medical costs
  • Legal and interpreter costs
  • Estimates of future costs
  • Death benefits (fatality claims incur a separate one-off charge)

Download Cost of Claims definition 2023-24 conventional policies (PDF 0.07MB)

Monthly Cost of Claims reporting: experience-rated customers only

If you would like to receive reporting for the claims and related costs which are impacting your premium, you can complete the attached Distribution List Request Form. This form is for experience-rated employers only with an average performance premium above $30,000.

By submitting this form, you are agreeing to receive a Cost of Claims report automatically each month, sent via Syncplicity. We currently do not automate cost of claims reports for non-experience-rated employers with an average performance premium $30,000 and below.

How to create an account and receive documents via Syncplicity (PDF, 0.46MB)

Download a copy of our Frequently Asked Questions (PDF, 0.44MB) 

Request a monthly cost of claims report-Experience-rated customers only

Loss prevention and recovery premiums

Loss Prevention and Recovery (LPR) for large businesses allows you to work with us to implement programs within your organisation to minimise your premiums.

If you have a LPR product and would like to discuss your premiums please reach out to your Insurance Specialist or email

    Premium adjustments

  • Dust Diseases contribution

    The NSW Government provides compensation to injured workers for dust-related diseases due to exposure to dust during their employment.

    This scheme is administered by icare dust diseases care.

    As an employer, you are required to pay the Dust Diseases contribution to fund this scheme. It is collected by workers insurance on behalf of icare Dust Diseases Care.

    The Dust Diseases contribution is calculated separately and added to the workers compensation premium.

    For more information on Dust Diseases rates refer to the relevant Premium rates table.

  • Mine Safety Fund premium adjustment

    The Mine Safety Fund was established by the Mine and Petroleum Site Safety (Cost Recovery) Act 2005 to provide for mine safety regulatory activities undertaken by the NSW Government.

    If you are an employer with wages in the mining industry, you are required to pay a mine safety fund premium adjustment. It is collected by icare.

    The adjustment is calculated separately and added to the workers compensation insurance premium. The Mine Safety Fund premium adjustment rate is set annually. 

    The rate for 2023-24 is 0.7360%, including GST.

  • Catastrophic Claim contribution

    The Catastrophic Claim contribution is a one-off premium adjustment for fatality claims arising from a workplace incident or injury, charged at policy expiry. 

    For experience-rated employers this is calculated at APP x 30% and will be shown as a separate item on your invoice and included in the premium payable. This charge and any related claims costs are not included in claims cost history when calculating future premiums. 

    For small employers the contribution is calculated at APP x 15% and invoiced separately to the premium.  

    The minimum contribution is $1,000 and the maximum $250,000. The contribution does not apply to exempt employers (wages less than or equal to $7,500) or to Loss Prevention and Recovery policies.