Each policy year, a target average premium rate is set. This target rate ensures that the WorkCover Scheme collects sufficient premium income to cover the anticipated costs associated with claims to be incurred during the year.
Basic tariff premium rates for each classification reflect ‘risk’ in that industry. They are calculated annually by WorkCover's actuaries, using the historical costs of claims - ie. costs associated with all the workplace injuries in that classification over the past five years, excluding the most recent year (as these costs are not yet fully developed) - and the wages of the industry - in terms of wages paid to workers and declared by employers for premium calculation purposes.