The California Department of Industrial Relations (DIR) has issued the 2018 assessments that workers’ compensation insurers are required to collect from policyholders to cover the budget of the state Division of Workers’ Compensation (DWC) and five related programs set up by state lawmakers. Insurers should apply the following rates against their policyholders’ estimated annual assessable premium for policies incepting January 1, 2018 through December 31, 2018:
| 2018 WC Administration Revolving Fund Assessment/User Funding: | 0.008146 |
| 2018 Uninsured Employers Benefit Trust Fund Assessment: | 0.000573 |
| 2018 Subsequent Injuries Benefits Trust Fund Assessment: | 0.003599 |
| 2018 Occupational Safety & Health Fund: | 0.002655 |
| 2018 Labor Enforcement & Compliance Fund: | 0.002150 |
| 2018 WC Fraud Account Assessment: | 0.002550 |
State law also requires insurers to advance the money on behalf of their policyholders (the first installment is due on or before January 1, 2018; the balance is due on or before April 1, 2018), then recoup the funds via surcharges and assessments on all workers’ compensation policies with 2018 inception dates. Assessment methodologies are noted in the memos DIR issued this week. DIR defines “Assessable Premium” as the premium the insured is charged after all rating adjustments (experience rating, schedule rating, premium discounts, expense constants, etc.) except for adjustments resulting from the application of deductible plans, retrospective rating or the return of policyholder dividends.
To cover their share of the 2018 assessments, self-insured and California legally uninsured employers must apply the following rates against the total amount of workers’ compensation indemnity they paid:
| 2018 WC Administration Revolving Fund Assessment: | 0.032620 |
| 2018 Uninsured Employers Benefit Trust Fund Assessment: | 0.007006 |
| 2018 Subsequent Injuries Benefits Trust Fund Assessment: | 0.011754 |
| 2018 Occupational Safety & Health Fund: | 0.011066 |
| 2018 Labor Enforcement & Compliance Fund: | 0.008882 |
| 2018 WC Fraud Account Assessment: | 0.008790 |
More details are included in the memos that DIR has posted under “What’s New” at www.dir.ca.gov/dwc/. The state is mailing the memos with invoices for each company’s share of the assessments and surcharges to California workers’ comp insurers, self-insured employers and legally uninsured employers. Questions about the 2018 surcharges and assessments may be directed to Naomi Carter at NCarter@dir.ca.gov; 415-557-1020.