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Calculating Your Insurance Premium

Calculating PremiumsYour WorkCover insurance premium is based on projected claims and operational costs. There are several factors which make up the calculation of your premium.  

Full details on calculating your premium can be found in:

Factors influencing your premium

1. Remuneration

Remuneration includes wages, salaries, superannuation and other benefits you pay to your workers.

2. Industry classification/rate

Your industry classification and rate reflects the claims experience of the industry in which you operate. 

3. The size of your business

If you have a remuneration of $200,000 or less, your insurance premium is calculated using the rate for your industry.

If your remuneration is over $200,000, then your WorkCover insurance premium is calculated using:

  • the rate of your industry
  • your claims experience – If you perform better than your industry average, you will pay less. If you perform worse, you will pay more
  • the size of your business, measured using your remuneration and industry rate.

How claims influence your premium

4. Capping 

A limit of 30% is placed on premium rate increases, to protect your business from dramatic fluctuations in the premium rate. This limit is not used if you change industry classification, or are a new workplace.

This capping is on the premium rate for your industry, and not on the amount of premium you pay, which will be influenced by changes in your remuneration.  

Detailed information on capping can be found in:

5. The buy-out option

If one of your workers is injured at work, in most instances, as their employer you are responsible for the first 10 days of weekly benefit payments and also for the first $682 (2016/17) (indexed annually) of reasonable medical and related like expenses.

However, you can remove this amount, known as an employer excess, by taking up the buy-out option and paying an additional loading of 10% on your premium. This means that your claims are managed and paid for by your Agent from day one. This makes it easier for employers, especially small businesses, to manage the early stages of a claim.

The buy-out option is available to all employers. If you intend to take up this option for the 2016/17 premium period, or you already have buy-out and do not intend to continue with it, you must notify your Agent by 1 August 2016.

6. Goods and Services Tax (GST)

Your WorkCover insurance premium is subject to 10% GST, which is added after the premium is calculated. 

The invoices sent to you after you have paid your premium are tax invoices for GST purposes.

Applying for a review

You have the right to request a review of an estimated claim cost where you think it has been calculated using incorrect data.

Predicting your premium

WorkSafe has developed a simulator to assist you in predicting your WorkCover insurance premium. The simulator provides indicative figures. 

Alternately you can calculate your current WorkCover insurance premium using Online Employer Services