Knowing the experience period can help you understand how an experience modification changes over time.
Knowing the experience period, and the payroll and losses developed by policies beginning during the experience period, can help forecast how an experience modification may be impacted when new data is used in the calculation and older data is no longer used.
The experience period begins four years and nine months prior to the effective date and ends one year and nine months prior to the effective date of the experience modification. In most cases, all payroll and losses developed under any policy beginning within the experience period will be used in determining the company's experience modification.
For example, if your anniversary rating date is January 1, 2014, the experience period is April 1, 2009 to April 1, 2012. In the example shown above, all payroll and losses developed by policies beginning during this period will be used to calculate the January 1, 2014 experience modification.
Some data developed during this period will not be used. This includes:
To review the Insurance Commissioner's regulations regarding eligibility and the experience period, see the California Workers' Compensation Experience Rating Plan - 1995 in theManuals and Plans section of the WCIRB website (www.wcirb.com).
The WCIRB anticipates that all first quarter 2014 experience modifications will be issued within two weeks of receiving the Insurance Commissioner's decision regarding the January 1, 2014 Pure Premium Rate Filing. No Decision has been issued yet.
Learn More about California's Experience Rating System: