Insurance Premiums Order 2000–2001

This Order is the Insurance Premiums Order 2000–2001.

This Order commences at 4 pm on 30 June 2000.

The premium payable by an employer for a policy of insurance is to be calculated by requiring the premium to be calculated for a period of insurance of not more than 12 months and:

if the employer is a category A employer for the purposes of the policy, in accordance with the following formula:

except that where the basic tariff premium for the employer [T] does not exceed $112,000, the experience adjusted premium for the employer is not to exceed twice the amount of that basic tariff premium [2T],

if the employer is a category B employer for the purposes of the policy, in accordance with the following formula:

where:

P is the premium for the time being payable by the employer in respect of the period of insurance to which the policy relates, being:

except as provided by paragraph (b) below, the initial premium so payable in accordance with this Order, or

where adjustments are required to be made to that premium by reason of the operation of this Order, the premium so payable by reason of those adjustments.

T is the basic tariff premium for the employer, calculated with respect to the period of insurance in accordance with Schedule 3 to this Order.

S is the experience adjustment factor for the employer determined with respect to the period of insurance in accordance with Schedule 4 to this Order.

E is the experience premium, if any, for the employer determined with respect to the period of insurance in accordance with Schedule 5 to this Order.

X is the excess surcharge factor for the employer determined with respect to the period of insurance in accordance with Schedule 6 to this Order.

D is the dust diseases contribution, if any, for the employer.

Q is the premiums adjustment contribution, if any, for the employer.

I is the input tax credit adjustment, if any, for the employer determined with respect to the period of insurance in accordance with Schedule 9 to this Order.

Schedules 1–9 and Table A to this Order form part of this Order.

The explanatory note does not form part of this Order.

In this Order:

basic tariff premium, in relation to a policy, means the basic tariff premium for the policy calculated in accordance with Schedule 3.

category A employer, in relation to a policy, means an employer whose basic tariff premium for the policy at the time at which the insurer first demands a premium for the policy would exceed $3,000, assuming the period of insurance to which the premium relates to be 12 months (whether or not that period of insurance is in fact 12 months).

category B employer means an employer, other than a category A employer.

claim means a claim made by a person against an employer to which a policy relates.

dust diseases contribution, in relation to an employer, means an amount equivalent to the contributions, if any, payable by an insurer in respect of the employer to the Workers’ Compensation (Dust Diseases) Fund.

employer includes a person who proposes to become an employer.

GST has the same meaning as in the A New Tax System (Goods and Services Tax) Act 1999 of the Commonwealth.

input tax credit entitlement, in relation to an employer, means the amount of input tax credit that may be claimed by the employer in accordance with the A New Tax System (Goods and Services Tax) Act 1999 of the Commonwealth in respect of the issue or renewal of a policy of insurance expressed as a percentage of the GST payable by the employer in respect of the issue or renewal of that policy.

insurer means a licensed insurer, or a former licensed insurer, within the meaning of the Act.

per capita rate means a rate specified in Column 3 of Table A that is expressed otherwise than as a percentage.

period of insurance, in relation to a policy, means a period for which an insurer assumes risk under the policy, being a period that commences on the first day on which the policy is in force after having been issued or renewed.

policy or policy of insurance means a policy of insurance within the meaning of the Act.

premiums adjustment contribution, in relation to an employer, means an amount equivalent to such part of the contributions, if any, payable by an insurer to the Premiums Adjustment Fund under section 208 of the Act as relates to the premium payable by the employer to the insurer.

regulations means regulations under the Act.

the Act means the Workers Compensation Act 1987.

wages means wages as defined in section 174 (9) of the Act.

For the purposes of this Order, a person is the predecessor of an employer if the employer has acquired the business of the person. This subclause applies whether the business acquired is the whole or main part of the business of the person or is the whole or main part of a separate and distinct business of the person, and whether or not the business acquired is carried on at the same location.

For the purposes of this Order, an employer that is a corporation is related to another corporation (whether or not that other corporation is an employer) if:

the employer and the other corporation are, by reason of the Corporations Law, taken to be related to each other, or

the directors of the employer are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of the directors of the other corporation, or

the directors of the other corporation are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of the directors of the employer, or

the other corporation is, by reason of the Corporations Law, taken to be related to another corporation the directors of which are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of the directors of the employer, or

the directors of the employer and the directors of the other corporation are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of another person, or

the other corporation has a share capital and the directors of the employer may (whether directly or indirectly) exercise, control the exercise of or substantially influence the exercise of, 50 per cent or more of the voting power attached to voting shares issued by the other corporation, or

(where the employer and the other corporation are corporations each of which has a share capital) any person who may (whether directly or indirectly) exercise, control the exercise of, or substantially influence the exercise of, 50 per cent or more of the voting power attached to voting shares issued by one of those corporations, may also exercise, control the exercise of or substantially influence the exercise of 50 per cent or more of the voting power attached to voting shares issued by the other corporation.

However, an employer that is a corporation is not related, for the purposes of this Order, to another corporation (whether or not that other corporation is an employer) if:

the employer and that other corporation are not, by reason of the Corporations Law, taken to be related to each other, and

the WorkCover Authority is satisfied that neither the employer nor the other corporation carry on a trade, business or profession so as to avoid or evade the payment of a premium payable by either the employer or the other corporation for a policy.

The value of any amount of money calculated or included in a calculation under this Order is to be expressed in dollars.

In this Order, a reference to wages that are payable by an employer includes a reference to wages that have been paid by the employer.

In this Order, a reference to any GST that is payable by an employer includes a reference to GST that has been paid by the employer.

In this Order, a reference to any input tax credit that may be claimed by an employer includes a reference to any input tax credit that has been claimed by the employer.

In this Order, a reference to wages, in relation to a period of insurance under a policy issued or to be issued to an employer or in relation to a period of 12 months ascertained by reference to any such period of insurance, is a reference:

except as provided by paragraph (b), to a reasonable estimate of the monetary value of all wages (not including any wages to which Schedule 8 applies) payable to workers by the employer in respect of the period of insurance or the period of 12 months, as the case may be:

as calculated by the insurer by reference to the returns, if any, furnished in accordance with the regulations by the employer to the insurer, or

where the employer does not agree with the estimate of the insurer and applies to the WorkCover Authority for an estimate of that value—as determined by the Authority, or

where the monetary value of those wages (not including any wages to which Schedule 8 applies) has been ascertained—to the actual value of those wages.

If at any time the employer has failed to furnish the returns in respect of any relevant period of insurance and the monetary value of the wages concerned has not been ascertained, the estimate of the monetary value of those wages is taken to be such amount as is calculated by multiplying the monetary value (or reasonable estimate) of wages for the immediately preceding equivalent period of insurance by 1.2.

This Order applies to and in respect of policies of insurance that are to be or have been issued or renewed so as to take effect on or after 4 pm on 30 June 2000 and before 4 pm on 30 June 2001.

If, before 4 pm on 30 June 2001, an insurance premiums order has not been made in respect of policies of insurance taking effect on or after that time, this Order applies to and in respect of those policies pending the making of such an order.

This Order does not apply to policies of insurance exempted by section 168 (4) (b) of the Act and by the Workers Compensation (Insurance Premiums) Regulation 1995.

The basic tariff premium (“T”) for an employer is to be calculated in accordance with the following formula:

where:

Wa, Wb…Wn are each a part of the total wages payable to workers by the employer in respect of the period of insurance for which the premium is to be calculated, being a part of the total wages attributable to a classification appearing in Column 1 of Table A applicable to the employer.

Ra, Rb…Rn are each a percentage rate specified in Column 3 of Table A that corresponds with a classification applicable to the employer, being a classification appearing in Column 1 of Table A opposite the percentage rate.

For the purposes of subclause (1), the classifications applicable to an employer and the part of total wages payable by an employer that is attributable to any such classification are to be:

as determined by the insurer by reference to returns, if any, furnished in accordance with the regulations by the employer to the insurer, or

where the employer does not agree with the determination of the insurer and applies to the WorkCover Authority for a determination—as determined by the Authority.

If the policy concerned relates to per capita rates in respect of some or all workers, those rates are to be substituted for wages in respect of those workers to determine Wa, Wb…Wn in the formula in clause 1.

The experience adjustment factor (“S”) for an employer is:

where the employer:

has been insured under a policy or policies for the period of 2 years immediately preceding the commencement of the period of insurance for which the premium is to be calculated or has been so insured for a longer period, and

has, during those 2 years, supplied the insurer with particulars complying with the regulations of claims against the employer,

the factor calculated in accordance with the following formula:

in any other case—0,

where:

T is the basic tariff premium for the employer, calculated with respect to the period of insurance in accordance with Schedule 3 to this Order and assuming the period of insurance to which the premium relates to be 12 months (whether or not that period of insurance is in fact 12 months).

For the purposes of subclause (1) (a), an employer is taken to have been insured for the period of 2 years referred to in that paragraph even if there has been a break or breaks in insurance (not exceeding one month in total) within that period.