How Assessment Rates are Set
Your WCB rate is the amount you pay for workplace injury insurance premiums. It’s calculated per $100 of of your payroll. For example, $2.65 rate means $2.65 for every $100 you pay in wages.
The rate is based on:
- The industry you’re in
- Your company’s past claims costs and payroll
- Whether your industry has a safety association levy
This is the step-by-step process we use.
1. Classifying your business's industry
When you register with WCB, your business is assigned a Standard Industrial Classification (SIC) code. This code comes from Statistics Canada and reflects the kind of work you do.
Employers with similar work and injury cost patterns are grouped into:
- Industry groups (e.g., forestry, trucking, manufacturing)
- Rate groups, which combine industries with similar claims costs. (e.g. finance, insurance, and real estate) Some industries are large enough to be in a rate group alone. Grouping industries spreads risk and keeps rates more stable from year to year.
2. Setting your industry rate
Each year, WCB calculates the costs of injuries in each rate group over the last 5 years, compared to total payroll in that group for the same period. This calculation of costs compared to payroll gives us something called the cost experience ratio.
The costs of recent claims have more importance in this calculation than older claims. The cost experience of each rate group is compared to the provincial average. This results in a rate per $100 of the payroll you report to WCB (called assessable payroll).
- If an industry has higher-than-average injury costs, its rate will be higher.
- If an industry’s cost experience is lower, its rate will be lower.
For example, if an industry’s injury costs are 3 times higher than the provincial average, its rate will be about 3 times higher than the average rate.
3. Experience Rating - adjusting for your claim history
Once your industry rate is set, WCB adjusts it based on your own cost experience ratio. This is called Experience Rating.
WCB looks at your total claim costs and payroll for the past 3 years to calculate your Experience Rating. We give recent injuries more weight in our calculations than older ones.
It then compares your cost experience ratio (claim costs ÷ payroll) to the average in your industry.
- If your cost ratio is lower than your peers, you’ll pay less. This is called a merit.
- If your cost ratio is higher, you’ll have a demerit and pay more.
The adjustment can range from:
- −10% to +20% for small employers
- −30% to +60% for large employers
The key takeaway is that fewer injuries and better return-to-work outcomes can help lower your rate. More injuries and poor return to work outcomes contribute to increasing your rate.
4. Industry Safety Association levies
Some industries also pay a levy to support safety associations that work to reduce injuries in that sector. If your industry is part of a safety association, the levy is usually added to your rate.
The Fishing Safety Association is the exception. A yearly fee is added to employer’s policies in June/July of each year. The fee is based on the employer’s premiums from the year prior. Contact us for more information.
5. Surcharges for consistently high claims
Some employers consistently have much higher claims costs than others in their industry. To encourage safer workplaces and better return-to-work outcomes, WCB applies a surcharge to their premium rates. This is done through the Surcharge Program.
You may be surcharged if your cost experience is at least 200% higher than others in your rate group for 4 or more consecutive rate years. We give smaller employers up to 6 years of poor history before a surcharge is applied.
Surcharges start small and increase over time if claim cost levels don’t improve. Employers at risk of being surcharged will receive 2 warning notices.
Get more details on the Surcharge Program.
6. Changes in WCB's rate model
Every year, WCB reviews rates in all industries. If the province is doing well, with lower average claims, the average premium may drop. Alternatively, we might keep rates the same and increase benefits instead.
Learn more about the rate model.
Sample Experience Rating Statement
Use this sample Experience Rating Statement as a helpful guide to understand your own statement.
A. Assessment Rate
The total rate you pay per $100 of assessable payroll. It includes your base rate, Experience Rating adjustment, and any applicable levies or surcharges.
B. Basic Industry Rate
This is the rate paid by all employers in your industry or rate group before Experience Rating adjustments.
C. Experience Rating Adjustment
A merit or demerit based on your company’s cost experience over the past 3 years, compared to others in your industry.
D. Surcharge
Applies only if your cost experience ratio is 200% or more above your industry’s average for 4 or more years in a row.
E. Safety Association Levy
An added charge that funds safety associations that support your industry.
F. Total Assessment Rate
The full rate used to calculate your premium, including all adjustments. It also appears at the top of your statement.
G. Rate Range
This is the range of potential rates for an employer of your size operating in your industry.
H. Your SIC Code and Rate Group
Employers are classified by industry, not by occupation. Everyone within the same industry is assessed at the same rate, no matter what type of work they do.
I. Your Payroll History
The total assessable payroll your company reported to WCB over the past 3 years.
J. Your Claims Costs
The total cost of new workplace injuries at your company from 2020 to 2022, including health care costs and income replacement benefits for time lost from work.
Want to learn more?
- Watch the How WCB Rates Are Set Webinar.
- Learn how to report your payroll and pay your premiums.
See what’s affecting your rate anytime.
With MyAccount, you can track how workplace injuries impact your WCB rate in real time. Experience Rating Statements are only available on MyAccount.
It’s also a quick, convenient way to submit forms and manage paperwork.