1 NEER & MAP Overview & Financial Impacts Prevention Division Phone: (416) Toll Free: FAX: (416) Web site:HCHSA Safety Group 2005 2 Experience Rating What is it? Modifies an employers premium based on accident experience Through refunds/surcharges (NEER) or rate group premium rate adjustments (MAP) Purpose? Encourage employers to promote workplace health and safety 3 How MAP Works 1994 4 MAP Table of Adjustments Average Premiums 1,000-1,499 1,500-1,999 2,000-2,499 2,500-4,999 5,000-9,999 10,000-14,999 15,000-19,999 20,000-25,000 0 Claims -5% -6% -7% -8% -10% 1 Claim 0% -5% 2 Claims +8% +7% +6% +5% +3% 0% 3 Claims +20% +19% +17% +15% +13% +11% +8% +5% 4 Claims +40% +38% +34% +30% +26% +22% +16% +11% 5 Claims +50% +44% +38% +30% +22% 6 Claims +50% +46% +35% 7 + Claims +50% An additional 10% increase applied for each claim with costs > $5,000 An additional 25% increase applied for fatalities Maximum increase is 50% 5 How NEER Works Pooling Charge Unfunded Liability (Retired by 2014) NEER Insurance Pooling Charge (LLOD / Claim Limits / Firm Limits / SIEF) Overhead (WSIB/MOL/SWA/LEG.) Expected Cost of New Claims Components of Gross Premium Rate Projected Future Cost (Reserves) Benefit Payments to Date NEER Insurance Pooling Charge (LLOD / Claim Limits / Firm Limits / SIEF) NEER Expected Claim Cost Organizations Actual Claim Cost = Refund $ or Surcharge $ NEER Actual Claim Cost Compared Overhead (WSIB/MOL/SWA/LEG.) Rating Factor Surplus (EC>AC) or Deficit (EC