Calculating the cost of your workers insurance premium
We consider a range of factors when determining the premium for your workers compensation insurance.
No two businesses are the same, so we tailor your workers compensation insurance premium based on information such as your industry, how much you pay in annual wages, and a range of other information. Take a look below for more information.
Your business wages
All businesses with conventional policies must declare their wages annually to icare to ensure they are paying the correct premium. Once you’ve taken out a workers insurance policy, you’ll need to lodge a declaration at the end of each policy period.
Learn more about declaring your actual wages
Your industry classification
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.
Before we calculate your premium, we multiply your WIC premium rate with the amount of wages your business pays to get your average performance premium, which will help us determine whether you’re considered a small employer or a medium to large employer.
If you have multiple separate and distinct business activities, the average performance premium formula (WIC rate x wages) is repeated for each applicable industry class, and the outcomes added together to produce the total average performance premium.
Your average performance premium
If your average performance premium is $30,000 or less, you’re considered a small employer and your total premium is not directly impacted by claims costs if a worker is injured however eligibility for the Safe Employer Reward (SER) may be impacted.
If your average performance premium is over $30,000, you’re considered a medium to large employer (known as an experience-related employer) and your premium will be impacted by your claims performance.
Check out the links below to see how your insurance premium will be calculated based on whether you’re a small employer, or a medium to large employer.
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.
Additional factors for experience-related employer premiums
As an experience-rated employer, your premiums may be affected as the result of a claim. If your business is classified as a small employer, the following information does not apply to you.
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
Your Claims Performance Rate (CPR) is calculated by comparing your claims performance with other NSW businesses, and rewards you with a lower premium if you have a good record of managing worker safety and recovery at work.
If your claims performance is better than the Scheme average, then your premium will be lower than your average performance premium.
Note, the Performance Discount applies to conventional policies only and depends on Scheme financial performance. It may not be applied every policy renewal year.
Claims costs included in experience premium (conventional policies)
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)
Monthly Cost of Claims reporting
Please note that this report is only available for experience-related employers with an average performance premium of $30,000 and over.
Request a monthly cost of claims report
By submitting the form, you are agreeing to receive a Cost of Claims report every month sent by Syncplicity, a secure, encrypted file sharing platform. This is the only channel that these reports are distributed.
Loss prevention and recovery premiums for large employers
Eligible large employers have the option to choose between an experience-rated premium model, or a Loss Prevention and Recovery (LPR) model, giving the opportunity to implement programs within the organisation to minimise premiums.
If you have a LPR product and would like to discuss your premiums, please reach out to your Insurance Specialist or email cis@icare.nsw.gov.au.
- Dust Diseases contribution
- Mine Safety Fund premium adjustment
- Catastrophic Claim contribution
