Workers Comp Premium calculation

How much does Workers Compensation cost?

Your Workers Compensation premium calculation is directly related to the risks associated with your specific operation, your company’s payroll, and your company’s loss history (claims).  A Tree Care company’s rate will be significantly higher than a Retail Store’s rate.  This is due to the higher likelihood of employee injury.  Additionally, your company’s prior claims are reviewed and compared to similar companies.  A factor called your Experience Modifier is created to penalize or reward you by increasing or decreasing your premium.

We have developed the Florida Workers Compensation Premium Estimator to help you better understand your Workers Compensation premium by learning the factors that go into the calculation and how you can begin saving your company money.  Biscayne Risk & Insurance is always available to discuss strategies to reduce your premium.

Florida Workers Compensation
Premium Estimator

Classifications iCodes used to estimate rates based upon specific type of work/industry

Annual Payroll i Estimated Payroll for following twelve months

$

Employers Liability Limits iCovers negligence lawsuits over work-related injuries and occupations disease. Limits requested for Bodily Injury by Accident / by Disease policy limit / by Disease each employee.

Experience Modifier iFactor calculated to compare your loss experience to other similar companies. 1.0 is the default modifier, indicating average loss history.

Safety Credit i2% premium credit offered to eligible employers for implementation of workplace safety program consisting of specific items

Drug Free Credit i5% premium credit offered to eligible employers for implementation of drug free workplace program consisting of specific items

Results

Manual Premium iSum of Premiums calculated for each Classification

Employers Liability iCovers negligence lawsuits over work-related injuries and occupational disease

Safety Credit i2% premium credit offered to eligible employers for implementation of workplace safety program consisting of specific items

Drug Free Credit i5% premium credit offered to eligible employers for implementation of drug free workplace program consisting of specific items

Total Subject to Experience Mod iPremium that will be calculated by your company’s experience modifier

Experience Mod iFactor calculated to compare your loss experience to similar companies. 1.0 is the default modifier, indicating average loss history.

Approx Premium Discount iAdjusts premium to reflect the relative expense of servicing large premium policies

Estimated Taxes and Fees iAdditional taxes and fees associated with your Workers Compensation policy

Expense Constant iPolicy fee charged on Workers Compensation policies to compensate for basic administration costs

Estimated Florida WC Premium iEstimated premium calculation for annual Florida Workers Compensation policy

Please fill all fields

A simplified workers’ compensation premium calculation*

Manual Premium

Florida Workers Compensation insurance premiums are calculated by multiplying the insured employer’s payroll by the rate promulgated by the National Council on Compensation Insurance (NCCI).  The rate corresponds to a job specific class code and is multiplied to each $100 in remuneration.

​For Example, the Fast Food Restaurant classification (9083) maintained a rate of $1.87 per $100 in payroll.  If the estimated payroll was $500,000, the manual premium would be calculated at $9,350, subject to additional factors.

Experience Mod

An Experience Modification Rate is a factor that was developed to compare an insured employer’s actual past loss experience and the expected loss experience of similar companies.  Once calculated by the NCCI, an employer’s Experience Modification Rate is multiplied by the manual premium to tailor the premium cost to the individual employer and provide incentive for loss reduction that would be absent from manual rating alone.  An Experience Modification of greater than 1.0 would be worse than average, while a rate lower than 1.0 would be better than average. 

​Using the example above, if the restaurant with the manual premium of $9,350 had a mod of 0.90, then their premium would be reduced by 10%, and calculated at $8,415, subject to additional taxes and fees. 

Policy Credits

There are opportunities for employers to reduce their premium through available policy credits. The Drug-Free Workplace credit affords a 5% premium credit after satisfying requirements of program.  Florida employers that implement a qualified Safety Program are eligible to receive a 2% premium credit.  

​Following on the prior example. If an insured earns a 5% Drug-Free Workplace credit, premium would be reduced to approx $7,994.​

Audit

Following the policy period, the insurance company may examine the books of the insured employer to compare the estimated annual payroll, projected prior to policy term, to the actual payroll.  The Workers Compensation carrier may perform the audit in-person or remotely, via phone, mail, or internet.

If the above referenced restaurant projected $500,000 in payroll but actually paid its employees $550,000, there would be an audit additional premium owed to the carrier – in this case $799.

Dividend

Florida Workers Compensation insurers may offer an insured guaranteed flat dividends or loss sensitive dividends, typically following the policy term.  These dividends can be a set % of premium (typcially 5% to 15%) or based upon a pre-agreed upon loss ratio throughout the term.  Upon successful completion of agreed upon guidelines, the insured will receive a return premium. 

If an insured employer pays $8,793 in premium on policy with 10% flat dividend and meets all eligibility guidelines, they should receive a return of approx $879 following the policy term.

*Workers Compensation policies are subject to additional fees, not contemplated in this example

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CALL | 561-571-1001

EMAIL | [email protected]

HOW CAN WE SERVE YOU?

CALL | 561-571-1001

EMAIL | [email protected]

HOME OFFICE

Biscayne Risk Group Inc.

5571 N. University Dr. Ste. 101

Coral Springs, FL 33067

Phone | 561-571-1001

Email | [email protected]

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HOME OFFICE

Biscayne Risk Group Inc.

5571 N. University Dr. Ste. 101

Coral Springs, FL 33067

Phone | 561-571-1001

Email | [email protected]