Workers Compensation premium and policy review
- eve4245
- Apr 10
- 3 min read
Concerned by a three-fold increase in its workers compensation premium, The Family Systems Hub engaged Risk Strategies to review its insurance arrangements and premium.
It resulted in a $9,422.09 premium reduction for the current 2024/25 year plus a historical correction for 2023/24 and 2022/23, delivering a total rebate of $13,589.
How we were able to achieve this outcome
Workers compensation insurance premiums are based on a variety of different variables, including:
Industry classification – a percentage-based premium rate applied to different industries based on risk.
Overall remuneration – which, depending on the specifics of individual contractor agreements, should or should not include contractor fees.
Claims history and return to work outcomes.
As workers compensation policy and claims management specialists, our consultants intimately understand the considerations and nuances that factor into determining the appropriate industry classification and what should be included in an organisation’s remuneration declaration.
It is not that uncommon for an organisation’s policy to be based on the wrong industry classification or for overall remuneration to be incorrectly declared, as the declaration requirements differ from the ATO’s requirements.
The review process
Our review process begins with building our understanding of the client’s operations, services, employment and contractor arrangements and agreements, to provide us with the necessary knowledge and insight to review the workers compensation policy and premium variables:
Industry classification In this instance, our review of the policy identified that the client’s industry classification was ‘Social Assistance Services’, which has a premium rate of 2.198%. Based on our review of The Family Systems Hub’s operations and services, we were of the belief that the appropriate industry classification for the business was ‘Other Allied Health Services’ which has a 1% lower premium rate of 1.198%.
Remuneration declaration review Our client had been including the fees paid to practitioners who were contractors in its overall remuneration declaration. Our review of the client’s contractor agreements determined that based on the terms and arrangements in place and the WorkCover policy definition, these contractors should not be classified as ‘workers’ and, as such, their fees should not be included in the remuneration declaration.
Securing a premium adjustment for the client
Upon taking the client through our assessment and findings, they engaged us to prepare and submit a submission to their WorkCover insurance agent on their behalf for the policy to be reviewed and amended.
The submission, which detailed the findings of our review and the case for reclassification, resulted in:
The industry classification being changed to ‘Other Allied Health Services’ (with a 1% lower premium rate) and contractor fees being removed from the client’s overall remuneration declaration, reducing the client’s 2024/25 premium by $9,422.
Reassessment and recalculation of the client’s premiums over the past three years, based on the new industry classification and remuneration less contractor fees, resulted in our client receiving a total rebate of $13,589 for 2024/25, 2023/24 and 2022/23.
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