| Claim-Free Discount Examples (Class 0510 Wood Frame Building Construction) |  | |
This is an example and may not reflect the actual numbers associated with your business.
These examples show how one time-loss claim can raise workers' compensation rates for an employer in class 0510 that is currently under the claim-free discount.
The rates are based on the 2007 proposed workers' compensation rates per hour worked.
Example 1
| No compensable claims (claim free) | ||||
|---|---|---|---|---|
| (a) | (b) | (c) | (d) | |
| Actual Losses | Expected Losses | Credibility Weight | Credible Estimate | |
| Primary | - | 19,543.51 | 54.00% | 8,990.01 |
| Excess | - | 19,858.73 | 8.00% | 18,270.03 |
| Total | - | 39,402.24 | - | 27,260.05 |
| Computed Experience Factor | 27,260.05 (Credible Estimate) divided by 39,402.24 (Expected Losses) |
equals | 0.6918 |
| Claim-Free Experience Factor | 0.6200 | ||
| Prior Experience Factor | 0.6200 | ||
| Final Experience Factor | 0.6200 |
Example 2
| One compensable claim at $5,000 | ||||
|---|---|---|---|---|
| (a) | (b) | (c) | (d) | |
| Actual Losses | Expected Losses | Credibility Weight | Credible Estimate | |
| Primary | 5,000.00 | 19,543.51 | 54.00% | 11,690.01 |
| Excess | - | 19,858.73 | 8.00% | 18,270.03 |
| Total | 5,000.00 | 39,402.24 | - | 29,960.05 |
| Computed Experience Factor | 29,960.05 (Credible Estimate) divided by 39,402.24 (Expected Losses) |
equals | 0.7604 |
| Claim-Free Experience Factor | 0.6200 | ||
| Prior Experience Factor | 0.6200 | ||
| Final Experience Factor | 0.7604 |
Example 3
| One compensable claim at $40,000 | ||||
|---|---|---|---|---|
| (a) | (b) | (c) | (d) | |
| Actual Losses | Expected Losses | Credibility Weight | Credible Estimate | |
| Primary | 28,208.83 | 19,543.51 | 54.00% | 24,222.78 |
| Excess | 11,791.17 | 19,858.73 | 8.00% | 19,213.33 |
| Total | 40,000.00 | 39,402.24 | - | 43,436.11 |
| Computed Experience Factor | 43,436.11 (Credible Estimate) divided by 39,402.24 (Expected Losses) |
equals | 1.1024 |
| Claim-Free Experience Factor | 0.6200 | ||
| Prior Experience Factor | 0.6200 | ||
| Final Experience Factor | 1.0000 |
See the Claim-Free Discount page for more information.
Call your Account Manager or local L&I office for more rate information.
