Oregon Workers Compensation Rates
Because Workers Compensation Insurance is mandatory, your Oregon business must be able to purchase workers compensation insurance. The challenge with this is some insurance companies regard some kinds of businesses a greater risk than others, these types of businesses might include:
- New businesses: because they have not yet established a safety record
- Type of business: those that involve hazardous work
- Loss history: businesses that have poor claim histories
Oregon businesses that have been unable to find a willing insurer in the open or general market, called the voluntary market, are placed in the assigned risk market, which is known as “the pool”. The pool is divided into two segments; direct assignment and the pool.
The workers’ compensation system aims to distribute the costs of the workers compensation fairly among all employers.
Oregon Workers Compensation Insurance rates factors:
The policy premium is based on an estimated payroll exposure and is considered to be a deposit. Shortly after the policy expires, your actual exposure during the policy period will be determined by an audit. After the audit of your workers compensation policy is completed by your insurance carrier they will prepare and send to you a Final Audit Statement.
This statement will indicate any additional premium you owe or any credit you will receive due to the payroll adjustment as determined by the audit. You can expect to receive the audit billing statement usually within three months after the end of your workers compensation policy period.
The classification covers all employees of the business, except for classifications called standard exceptions, involving occupations common to many businesses. These include clerical, office and drafting employees, drivers, chauffeurs and their helpers, outside sales people, collectors and messengers.
There’s an established minimum premium which varies according to employer classification. It is the lowest premium an insurance company will accept to provide worker’s compensation insurance
An experience mod above a 1.0 is higher than average (higher than 1.0 is surcharged). Low losses = lower experience modification.
Experience modifications are built up over a three year period, and often the last year is not included. So, for a policy renewal date of June 1, 2018, your experience modification probably would include claims from June 1, 2014 to June 1, 2017. If your business has better experience than the average business in your classification you would receive a premium credit.
The benefits of experience rating are:
It provides an incentive for loss prevention and implementation of safety programs by your business.
The premium for each insured reflects the individual insured’s experience and should be a better indication s of the costs of future losses than the average rate for the classification.
Accident Frequency: Frequency is a measure of how many accidents a business has had during the experience period.
Accident Severity: Severity measures the cost of any accidents that have occurred.Accident frequency is a better indication of future losses and is the more important of the factors when it comes to the rating.
Reach out to me with questions that you have about your Oregon Workers Compensation Insurance Rates. I will discuss with you how rates are accessed and provide you with comparative Oregon Workers Compensation Insurance Rate quotes from multiple insurance carriers so you can get the best possible rate.
As an insurance broker I help businesses throughout Oregon and the Pacific Northwest manage risk.