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WorkCover insurance 2016/17

Industry Rates and Industry Claims Cost Rates for 2016/17

The Average Premium Rate for 2016/17 is 1.272% of the State's rateable remuneration. This is a continuation of the average rate for 2015/16 and reflects a record low for Victoria.

Industry Rates and Industry Claim Cost Rates (IRs and ICCRs) were gazetted on 18 May 2016. The Gazettal Notice is available from the Gazette website. Individual industry rates are available in a Special Gazette (Special 156 Wednesday 18 May 2016).

Key dates  

Please note the following key dates for 2016/17: 



3 May

Online system available to estimate 16/17 remuneration

You can review or update your Estimate of Rateable Remuneration online now using Online employer services

Submissions received before 30 June 2016 will be reflected in renewal notifications.

31 May

Claims Statement available online
Employers with claims impacting on the calculation of their 2016/17 WorkCover insurance premiums will be able to access a Statement of their WorkCover insurance claims from Online Employer Services

9 June

Certificate of Currency available

Note: To have a Certificate of Currency sent to you each year, sign up for email preferences via Online employer services   

7 July

Employers will receive their Premium Renewal notifications for 2016/17

1 August

Last day to change your current excess buy-out option.

5 August

Due date for annual insurance premium payment (discounted by 5%).

1 October

Due date for annual insurance premium payment (discounted by 3%).

Due date for first instalment insurance premium (if you pay on a monthly or quarterly plan).

Note: If you pay using a quarterly instalment plan, you must pay the instalments by the first day of October, December, March and June. If you choose to pay your premium monthly, payment is due in 10 instalments on the first day of each month, starting on 1 October 2016 and ending on 1 July 2017.

30 October

Due date to certify Rateable Remuneration for 2015/16 (if your rateable remuneration for 2014/2015 was more than $200,000).

You can submit your Declaration of Rateable Remuneration online using Online employer services

1 November

Due date for annual insurance premium payment (without discount).

31 March 2017

Due date to certify Rateable Remuneration for 2015/16 (if your rateable remuneration for 2014/2015 was less than $200,000).

You can submit your Declaration of Rateable Remuneration online using Online employer services

Continuation of the 5% and 3% discount for early payment of premium

A discount of 5 percent per annum is again available for employers who pay their full year's premium by 5 August 2016. A discount of 3 percent per annum is also available to employers who wish to continue to pay their premium in full by 1 October.

To qualify for the 5 percent discount employers must:

  • Pay any outstanding balance from 2015/16 (or previous years); and
  • Pay their full 2016/17 premium (less the 5% discount) by 5 August 2016.

To qualify for the 3 percent discount employers must:

  • Pay any outstanding balance from 2015/16 (or previous years); and
  • Pay their full 2016/17 premium (less the 3% discount) by 1 October 2016.

Information on ways to pay your premium will be set out in your Premium Notice.

If you disagree with the estimated remuneration figure used to calculate your WorkCover insurance premium for 2016/17 you can go online and update your remuneration. You can then recalculate your premium and also pay your premium at this time.

For an explanation of the maintenance tasks employers must complete in relation to their WorkCover insurance see maintain your WorkCover insurance

Earlier date for electing to buy-out insurance excess option

Each WorkSafe claim is subject to an insurance excess consisting of payment of the first 10 days of weekly benefits and the first $669* of reasonable medical and like expenses (*for 2015/16). Employers can elect to remove this excess by paying an additional 10% of their premium (referred to as the buy-out premium).

The effect of removing the excess is that your claims are managed and paid for by your Agent from day one. This makes it easier for employers to manage the early stages of a claim.

As occurred last year, the date by which you have to inform your Agent that you want to remove the excess or reinstate it is 1 August 2016. This date reflects the fact that premium notices are now being issued in July instead of September. This can be done when you update your 16/17 remuneration online before 1 August.

If you are a new employer you must make your election at the time of registering with WorkSafe

Other key dates and parameters for WorkCover insurance premiums in the 2016/17 Premiums Order

  • Claims Reporting Period – 1 January 2013 to 30 June 2015
  • Remuneration Experience Period – 1 July 2012 to 30 June 2015
  • Minimum premium – $188 ($206.80 including GST)
  • Maximum claims cost for an individual claim – $363,400
  • Maximum legal costs for an individual claim – $68,000
  • Maximum recovery for an individual claim allocated to an employers' performance calculation – $363,400

Changes to the Premiums Order

Each year a new Premiums Order is made which sets out the rules for calculating employer premiums and includes the industry classifications which form part of the premium calculation. The Premiums Order for 2016/17 is available as a PDF from the Government Gazette website.

The main changes in the 2016/17 Premiums Order are as follows:

Employer performance rate calculation

Employer performance is taken into account in the premium calculation of large employers as a measure of employer's OH&S and claims management performance compared to the average performance of their industry. The calculation of an employer's performance, used in determining their WorkCover premium, is known as the Employer Performance Rate (EPR).

The EPR calculation includes the total claims costs and remuneration for all workplaces of the employer, including any predecessor workplaces that operated during a specified three-year period (the remuneration experience period).

A workplace becomes a predecessor workplace where the predominant activity that was being carried on in that workplace is now carried on at a new workplace and there is a relationship of control between the two employers (for instance, the old employer, or 'predecessor', and the new employer, or 'successor').

The Premiums Order for 2016/17 clarifies the application of predecessor workplaces.

New arrangement for employer excess

Each WorkCover claim is subject to an employer excess consisting of:

  • payment of first 10 days of incapacity, and
  • the first $669* in medical & like expenses (*this is the excess for 2015/16).

To reduce red tape and delays in administering claims, employers now have option of paying the medical costs excess directly to their WorkCover Agent who will then handle payment of invoices in relation to this amount on their behalf.

A provision has been included in the Premiums Order for 2016/17 to provide that any payments made by the Agent under this arrangement are not included as claims costs in the EPR calculation.

New defined term for workplaces located outside Victoria

For ease of reference, a new defined term 'out-of-state workplaces' has been inserted into the General Introduction to Schedule 1. This term has also been inserted into the definition of 'predominant industry', the operational services rule and class M69610 Corporate Head Office Management Services.

Workplaces located outside Victoria are relevant in the following instances:

  • Determining the predominant industry where the employer or group has more than one workplace
  • Applying the operational services rule contained in item 9 of the General Introduction to Schedule 1
  • Determining whether the requirements for the Corporate Head Office Management Services class have been met

Classification changes

Retirement villages

With the introduction of the ANZSIC based industry classification system in July 2011 the activity of 'retirement village operation' was included in class Q86010 Aged Care Residential Services. WorkSafe has identified that this treatment of retirement village workplaces may conflict with the rule for determining the predominant activity of a workplace under the value added methodology, as retirement villages have different production functions to residential aged care facilities:

Residential aged care facilities:

  • Regulated by the Commonwealth Government and are for elderly persons who are assessed as being too frail to live independently;
  • Consist of hostels and nursing homes where nursing, medical and personal care is provided (high labour costs mainly relating to the provision of care);
  • Operators are government approved and receive both government funding and private fees for the provision of residential care;

Retirement villages:

  • Regulated by the State Government and are for elderly persons are able to live independently;
  • Consist of independent living units or serviced apartments in community settings with no nursing, medical or personal care provided (low labour costs mainly relating to upkeep of property)
  • Operators are not government funded and receive fees from the residents for the maintenance of property and communal facilities.

Changes have therefore been made to the 2016/17 Premiums Order to remove the two listed activities relating to retirement villages from class Q86010 Aged Care Residential Services. This will have the intended affect that all retirement villages will be required to be classified based on their predominant activity as determined under the value added methodology. For more information on WorkSafe's application of value added analysis see The value added approach to predominant activity

In order to implement this change, WorkSafe's Agents will be reviewing all retirement village workplaces to ensure that they are correctly classified. It is anticipated that the majority of retirement villages are correctly classified. Where this is not the case, workplaces will be reclassified and relevant premiums recalculated in accordance with the current policy regarding the over-payment of underpayment of premium as a result of an incorrect classification. For more information on WorkSafe's approach to re-classifying workplaces see Classification date of effect

Any queries regarding the classification of retirement villages should be referred to your WorkSafe Agent.

Roofing services

A new exclusion has been inserted in class E32310 Plumbing Services to prevent the incorrect classification of roofing workplaces to this class. The only roofing activity that goes to this class is the installation of roof guttering. The installation of roofing materials (except roof guttering) are included in class E32230 Roofing Services.