Retrospective Rating (Retro) is a safety incentive program offered by L&I. In Retro, you can potentially earn a partial refund of your workers’ compensation premiums if you reduce workplace injuries and lower associated claim losses.
Any employer with an industrial insurance account in good standing may qualify to participate— either as a member of a Retro group or as an individual business. Other factors can affect eligibility as well.
Why consider Retro?
Any time one of your employees is injured, it costs your company. The loss can be in production, hiring and training a replacement, rescheduling work, or the loss of a project or job. Plus, the injury can cause your workers’ compensation premium rates to go up.
In Retro, you have an opportunity to turn your good safety performance into a refund from L&I by preventing injuries and engaging in proactive claims management.
How Retro works
Retrospective rating is simply another way of calculating your premium, after the fact or “retroactively.”
A Retro coverage period lasts 12 months and can begin any calendar quarter. About 9 months after a coverage period ends, L&I looks back at your (or your group’s) actual experience and calculates a retrospective premium (Retro premium) for that 12-month coverage year. If your Retro premium for the coverage year is below what is expected, you can potentially earn a partial refund of the difference between the Retro premium and the standard premium. This evaluation occurs three times for the coverage year, about 12 months apart.
Being in Retro requires a commitment to improve safety and prevent injuries in the workplace. If your calculated Retro premium is higher than the amount of standard premium you paid, it could result in your having to pay an additional amount (assessment). There is a pre-selected limit to this assessment, but it’s important that you recognize and understand this risk.