Suppose a firm had an experience factor of 0.9000 during 2008 and the computed factor for 2009 was 1.1971. Suppose also that the firm has a compensable claim in its experience period so it isn't eligible for the compensable-claim-free maximum factor.

The computed factor of 1.1971 is more than 25% larger than 0.9000 (1.1971 / 0.9000 = 1.3301 so it is 33.01% larger), so the 25% annual limitation would limit the 2007 experience factor to 1.1250 (= 0.9000 x 1.25).

Since the computed factor (1.1971) is above 1.0000 and the prior factor (0.9000) isn't greater than 1.3333, the exception to the 25% annual limitation doesn't apply. The final factor is 1.1250.