WorkCover assisting you to keep your business safe and successful
Safe Business
How are workers compensation premiums calculated and how are they paid?
The basic premium is a percentage of your payroll. Insurers assign all employers with an industry classification based on the description of their trade or business which employers provide on their insurance proposal. The insurer uses the official classification listing published by WorkCover in the Insurance Premiums Order.
At the beginning of each insurance period (known as the "term"), you must provide your insurer with an estimate of the wages that you'll pay in the next 12 months. Your insurer will calculate the premium on the basis of that estimate. If the base premium tariff is more than $3000 you can pay in three instalments at the end of the first, fourth and eighth months of the policy period. If your premium is less than $3000 you must pay the whole premium within one month of date of the issue of the assessment notice.
At the end of the insurance period, you must provide your insurer with a declaration of the actual wages you paid during the year. The insurer will calculate a "final" or "actual" premium based on the actual wages paid. If this is different to the estimated premium already paid, there will be an adjustment payment or refund. For more details, contact your insurer.