www.ecao.org 28 T NEW RATE FRAMEWORK The Workplace Safety & Insurance Board (WSIB) has finalized and released the changes to the premium rate setting system used in Ontario. Currently, the WSIB uses either NEER, CAD-7 or MAP experience rating programs in order to calculate the total dollar amount in premiums to be paid by Ontario employers, including surcharges and rebates. The new system is called the “New Rate Framework” and will completely replace NEER, CAD-7 and MAP. The WSIB is shifting to this new system in order to make the calculation of employer premiums more transparent and easier to understand. The New Rate Framework will be introduced on January 1, 2020, with a transition plan in place to phase out NEER, CAD-7, and MAP by the end of the same calendar year. Are You Ready for WSIB’s New Rate Framework? Key Features Simpler classification The WSIB is simplifying how businesses will be classified by adopting the North American Industry Classification System, or NAICS. NAICS is already used by Statistics Canada, the Canada Revenue Agency and is a North American standard. It will help simplify and streamline the classifications, making it easier to understand why businesses are classified the way they are. Under the NAICS, employers will be classified into 34 classes/sub classes instead of the previous 155 different Rate Groups. In the New Rate Framework, employers will be assigned to a Class that is representative of their business’ predominant activity (this mostly applies to businesses with multiple Rate Groups under the NEER & CAD-7 systems). Premium rate stability The New Rate Framework takes a prospective rate setting approach. This means that in addition to annual rates, employers will be provided projected premium rates in advance, which can serve as an early indicator as to the direction of their premium rates. This will help keep employers informed and prepared for any changes to their rates in the future. As well, any premium changes as a result of the new system will be phased in over time, allowing employers to adjust. Two step model The New Rate Framework will use a two-step approach to set and adjust premium rates for businesses. The first step involves setting an average rate for each industry class based on their risk profile and share of responsibility to maintain the insurance fund. By Tanya George, Client Relationship Manager,TeksMed Services Inc.