Assigned Risk Rates and Rating Values for the Michigan Workers' Compensation Placement Facility (2013)

Transcription

1 Assigned Risk Rates and Rating Values for the Michigan Workers' Compensation Placement Facility (2013) Table of Contents 1. Circular Letter 2. Class Code Rating Values 3. Miscellaneous Values 4. Footnotes 5. Weighting & Ballast Values 6. Retrospective Rating Plans

2 MICHIGAN WORKERS COMPENSATION PLACEMENT FACILITY P.O. BOX 3337 LIVONIA, MI PHONE: (734) FAX: (734) Internet Web Site: September 25, 2012 CIRCULAR LETTER #249 TO ALL PARTICIPANTS IN THE MICHIGAN WORKERS COMPENSATION PLACEMENT FACILITY Regarding Assigned Risk Rates and Rating Values for the Michigan Workers Compensation Placement Facility - Effective 1/1/2013 Applicable to New and Renewal Policies Only Dear Member: Included in this circular letter are rating values which will be applicable to new and renewal Assigned Risk policies having effective dates on or after January 1, There is no application to outstanding policies. Please share this rate information with agents representing your firm. All Assigned Risk rates and values are now available via the Internet on our web The revision represents an average decrease of 4.9% in overall rate level for the residual market. The rate changes are determined by using weighted averages of 80% statewide experience and 20% Facility experience. These 2013 Assigned Risk Rates include a 2.1% decrease due to the enactment of PA 266 in December of This law change provided a number of amendments to Michigan s workers compensation system. By industry group, the changes are as follows: Manufacturing Contracting Office & Clerical Goods & Services Miscellaneous 5.9% decrease 2.2% decrease 11.4% decrease 4.7% decrease 2.0% decrease Specific classifications within each industry class may vary from the average depending upon the volume and character of the particular classification experience.

3 MWCPF Circular Letter # 249 Page 2 Swing limits have been applied which operate to hold individual class rates to the following maximum movement from January 1, 2012 rates. Manufacturing Contracting Office & Clerical Goods & Services Miscellaneous from 19.1% above to 30.9% below from 22.8% above to 27.2% below from 13.6% above to 36.4% below from 20.3% above to 29.7% below from 23.0% above to 27.0% below The classifications which have been limited are: Miscellaneous Values List of Classifications Limited by Upper Swing List of Classifications Limited by Lower Swing United States Longshoremen s and Harbor Workers Compensation Coverage Percentage Due to the benefit provisions of federal and state laws, the United States Longshoremen s and Harbor Workers Compensation coverage percentage applicable only in connection with Rule XI - D-3 United States Longshoremen s and Harbor Workers Act of the Basic Manual for Michigan Workers Compensation Placement Facility is 70%, applicable to new and renewal business. As a multiplier, the percentage increase is 1.70 (rate multiplied by 1.70). 2. Retrospective Rating Plan Tax Multiplier Due to the change in the Miscellaneous Tax and in the Secondary Injury Fund, the Silicosis and Dust Disease Fund, and the Occupational Safety Fund Assessment, the tax multipliers used in connection with retrospective ratings are: A. State (Non-F Classes) B. Federal Classes, or Non-F classes where rate is increased by the USL & HW Act percentage 1.046

4 MWCPF Circular Letter # 249 Page 3 These factors are applicable to new and renewal policies. 3. Basis of Premium Basis of Premium applicable in accordance with the footnote instructions for Code 7220 Taxicab Company - Drivers is $27, Remuneration for Executive Officers The weekly payroll amount for corporate officers and active members of limited liability companies is $430 for the minimum weekly payroll assumption and $1,700 is the maximum. 5. Minimum Premiums The Maximum Minimum Premium is $750. The Minimum Premium multiplier is 125. Example: Manual Rate = $4.40 x 125 = $550 + $200 = $750 (Manual Rate) x (Multiplier) + (Expense Constant) = Minimum Premium The revision of rates and rating values was approved for use in the Facility and is applicable to all Facility policies with new or renewal dates of January 1, 2013 or later. Yours truly, Gary Thompson

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10 EXHIBIT III MICHIGAN EXPERIENCE RATING PLAN MANUAL PART FIVE Page 6 Effective January 1, 2013 TABLE OF WEIGHTING VALUES APPLICABLE TO ALL POLICIES Expected Weighting Expected Weighting Losses Values Losses Values 0-1, , , ,435-5, , , ,799-10, , , ,257-14, ,749-1,003, ,811-19, ,003,841-1,060, ,465-32, ,060,302-1,120, ,557-48, ,120,461-1,184, ,461-62, ,184,696-1,253, ,608-76, ,253,437-1,327, ,383-90, ,327,174-1,406, , , ,406,473-1,491, , , ,491,990-1,584, , , ,584,485-1,684, , , ,684,849-1,794, , , ,794,133-1,913, , , ,913,580-2,044, , , ,044,678-2,189, , , ,189,220-2,349, , , ,349,385-2,527, , , ,527,853-2,727, , , ,727,951-2,953, , , ,953,866-3,210, , , ,210,939-3,506, , , ,506,095-3,848, , , ,848,473-4,250, , , ,250,392-4,728, , , ,728,865-5,308, , , ,308,066-6,023, , , ,023,546-6,929, , , ,929,818-8,114, , , ,114,939-9,731, , , ,731,010-12,065, , , ,065,328-15,733, , , ,733,538-22,336, , , ,336,307-37,742, , , ,742, ,774, , , ,774,957 AND OVER , , , , , , (a) State Per Claim Accident Limitation $171,000 (b) State Multiple Claim Accident Limitation $342,000 (c) USL&HW Per Claim Accident Limitation $492,000 (d) USL&HW Multiple Claim Accident Limitation $984,000 (e) Employers Liability Accident Limitation $60,000 (f) USL&HW Act -- Expected Loss Factor -- Non-F Classes % Cap on Modifications = (0.0004){(Expected Losses) / (6.85)}

11 EXHIBIT III MICHIGAN EXPERIENCE RATING PLAN MANUAL PART FIVE Effective January 1, 2013 TABLE OF BALLAST VALUES APPLICABLE TO ALL POLICIES Page 7 Expected Ballast Expected Ballast Expected Ballast Losses Values Losses Values Losses Values 0-36,845 17,125 1,182,317-1,216, ,000 2,380,720-2,414, ,875 36,846-63,413 20,550 1,216,548-1,250, ,425 2,414,965-2,449, ,300 63,414-93,941 23,975 1,250,780-1,285, ,850 2,449,210-2,483, ,725 93, ,146 27,400 1,285,012-1,319, ,275 2,483,456-2,517, , , ,134 30,825 1,319,246-1,353, ,700 2,517,701-2,551, , , ,536 34,250 1,353,480-1,387, ,125 2,551,947-2,586, , , ,180 37,675 1,387,715-1,421, ,550 2,586,192-2,620, , , ,976 41,100 1,421,951-1,456, ,975 2,620,438-2,654, , , ,874 44,525 1,456,188-1,490, ,400 2,654,684-2,688, , , ,843 47,950 1,490,425-1,524, ,825 2,688,930-2,723, , , ,864 51,375 1,524,662-1,558, ,250 2,723,177-2,757, , , ,924 54,800 1,558,901-1,593, ,675 2,757,423-2,791, , , ,013 58,225 1,593,139-1,627, ,100 2,791,669-2,825, , , ,126 61,650 1,627,379-1,661, ,525 2,825,916-2,860, , , ,257 65,075 1,661,618-1,695, ,950 2,860,162-2,894, , , ,403 68,500 1,695,858-1,730, ,375 2,894,409-2,928, , , ,562 71,925 1,730,099-1,764, ,800 2,928,655-2,962, , , ,731 75,350 1,764,340-1,798, ,225 2,962,902-2,997, , , ,908 78,775 1,798,581-1,832, ,650 2,997,149-3,031, , , ,093 82,200 1,832,822-1,867, ,075 3,031,396-3,065, , , ,284 85,625 1,867,064-1,901, ,500 3,065,643-3,099, , , ,481 89,050 1,901,306-1,935, ,925 3,099,890-3,134, , , ,682 92,475 1,935,549-1,969, ,350 3,134,137-3,168, , , ,887 95,900 1,969,791-2,004, ,775 3,168,384-3,202, , , ,096 99,325 2,004,034-2,038, ,200 3,202,632-3,236, , , , ,750 2,038,277-2,072, ,625 3,236,879-3,271, , , , ,175 2,072,521-2,106, , , , ,600 2,106,764-2,141, , , , ,025 2,141,008-2,175, , ,962-1,011, ,450 2,175,252-2,209, ,325 1,011,184-1,045, ,875 2,209,496-2,243, ,750 1,045,407-1,079, ,300 2,243,741-2,277, ,175 1,079,633-1,113, ,725 2,277,985-2,312, ,600 1,113,860-1,148, ,150 2,312,230-2,346, ,025 1,148,088-1,182, ,575 2,346,475-2,380, ,450 For Expected Losses greater than 3,271,125, the Ballast Value can be calculated using the following formula (rounded to the nearest 1): Ballast = (0.10)(Expected Losses) (Expected Losses)(6.85) / (Expected Losses + (700)(6.85)) Cap on Modifications = (0.0004){(Expected Losses) / (6.85)}

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