Claims-Free Credit
Effective for policies renewing on January 1, 2007 and after, the Claims-Free Credit will be available for qualifying policies based on updated criteria. The credit may be a substantial cost savings to many policyholders. This renewal credit recognizes those policyholders who demonstrate the ability to control their claims costs by providing and maintaining a safe work environment. The 10 percent Claims-Free Credit will be applied automatically upon renewal to qualifying renewal policies when they meet all of the following three criteria:
- Base premium from $1,000 to $74,999 on the renewal year. Base premium is the total amount of premium determined by multiplying the base rate for each applicable class code by the annual payroll estimate for each class before any experience modification score, adjustments, or discounts are applied.
- Continuous State Fund coverage during the appropriate experience period.
- Total paid indemnity costs that do not exceed $1,000. Please see the table below. Note that Medical-only claims and the medical portion of indemnity claims do not count towards the $1,000 limit.
| If the renewal base premium of the policy is: |
Paid indemnity cannot total more than $1,000 for policy years: |
| $50,000 - $74,999 |
2005 |
| $25,000 - $49,999 |
2004 and 2005 |
| $1,000 - $24,999 |
2003, 2004, and 2005 |
Please be aware that the policy years used in determination in the above example are for 2007 renewal base premium calculations. Our criteria are one year used for those with renewal base premium of $50,000 to $74,999. Two years are used for those of $25,000 to $49,999 and three years for $1,000 to $24,999. Keep in mind, the years used for determination will change in subsequent years.
If you have any questions, please contact your State Fund representative or call our Customer Service Center.
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