The WCIRB Large Risk Classification Validation Program was created for the purposes of verifying insurer audits for large premium policies which are conducted in accordance with the provisions of the California Workers’ Compensation Uniform Statistical Reporting Plan—1995, providing a practical method to measure the payroll and claims reported on unit statistical reports (USR) that may significantly impact ratemaking, and facilitating the identification and remediation of an insurer’s systemic issues related to the reporting of payroll and loss for large policies. 

All member insurers are subject to monthly policy selection based on USRs received in the month preceding the selection. Each insurer receives no more than five selections per quarter and each selection is made exclusively from high premium policies exceeding the scope of the WCIRB Premium Audit Accuracy Program.

Using all information available, including audit materials submitted by the insurer, the WCIRB reviews the reported payrolls and losses and determines if the USR contains any reportable errors as defined below:

• Payroll Error
  The USR payroll is misclassified and the misreported payroll represents 2% or more of the statewide average annual payroll for that classification as published by the WCIRB.
• Claims Error
  The USR is found to have misclassified three or more of the claims sampled by the WCIRB.

Under this program, insurers are assessed significant fines for:

(a) untimely submission of the documents requested by the WCIRB in order to be able to conduct the audit;

(b) finding of an Error as defined above; or

(c)  untimely submission of required corrections to USRs as a result of an Error.

In addition, an insurer may be subject to remedial measures and other corrective actions as determined by the WCIRB.

• View the program: WCIRB Large Risk Classification Validation Program>