State Regulators Announce 2015 California Workers Comp User Funding Assessment Rates

The California Department of Industrial Relations (DIR) has determined the 2015 assessments that workers’ compensation insurers are required to collect from policyholders to cover the budget of the state Division of Workers’ Compensation (DWC) and five related programs set up by state lawmakers. The assessments and surcharges cover the Workers’ Compensation Administration Revolving Fund; the Uninsured Employers Benefits Trust (UEBT) Fund; the Subsequent Injuries Benefits Trust (SIBT) Fund; the Occupational Safety and Health Fund; the Labor Enforcement & Compliance Fund; and the Workers’ Compensation Fraud Account. Insurers should apply the following rates against their policyholders’ estimated annual assessable premium for policies incepting January 1, 2015 through December 31, 2015: 

2015 WC Administration Revolving Fund Assessment/User Funding:   0.007100
2015 Uninsured Employers Benefit Trust Fund Assessment:   0.001177
2015 Subsequent Injuries Benefits Trust Fund Assessment:   0.000538
2015 Occupational Safety & Health Fund:  0.002348
2015 Labor Enforcement & Compliance Fund: 0.001505
2015 WC Fraud Account Assessment:  0.001814

Assessable premium is the premium an insured is charged after all rating adjustments (experience rating, schedule rating, premium discounts, expense constants, retrospective rating, etc.) except adjustments resulting from the application of deductible plans or the return of policyholder dividends. Insurers must advance the money to the state on behalf of policyholders, then recoup the funds via policy surcharges and assessments. The first installment is due to the state on or before January 1, 2015; the balance is due on or before April 1, 2015, and payments may be made by Electronic Funds Transfer (EFT) or by check.

To cover their portion of the 2015 assessments, self-insured employers must apply the following rates against the total amount of WC indemnity paid and reported on their Self-Insurer’s Annual Report. 

2015 WC Administration Revolving Fund Assessment:  0.034985
2015 Uninsured Employers Benefit Trust Fund Assessment:   0.005759
2015 Subsequent Injuries Benefits Trust Fund Assessment:   0.003207
2015 Occupational Safety & Health Fund:  0.010827
2015 Labor Enforcement & Compliance Fund:  0.007834
2015 WC Fraud Account Assessment:  0.009039

More details are included in the DIR memos issued last week. CWCI has posted copies of the memos at http://www.cwci.org/document.php?file=2548.pdf, and DIR is mailing the memos, along with invoices for each company’s share of the assessments and surcharges to California workers’ comp insurers, self-insured employers and legally uninsured employers. Questions about the 2015 surcharges and assessments may be directed to DIR Accounting Administrator II Amadeo Urbano at AUrbano@dir.ca.gov; 415-703-4283.