When an ownership change takes place for a particular business, the WCIRB must determine what to do with the historical data that has been generated by that business. This determination impacts the experience rating for that business. Generally, a change in ownership is defined as a transfer of an entity's operations or assets to another entity. Section IV, Rule 1, Paragraph a(1) of the California Workers' Compensation Experience Rating Plan—1995  specifically defines a change in ownership for experience rating purposes, as follows:

  • All or a portion of the ownership in an entity is sold, transferred or conveyed from one person to another
  • An entity is dissolved or non-operative and a new entity is formed
  • Two or more corporations undergo a statutory merger or consolidation
  • All or most of the tangible or intangible assets of an entity are sold, transferred or conveyed to another entity
  • A trusteeship or receivership is set up, either voluntarily or at the direction of the courts, to operate a business

Once it is determined that a change in ownership has occurred, the next step is to determine whether the change was material. The first step in analyzing any change in ownership is determining the names and ownership interest of all owners before and after the effective date of the change.

Learn more about Material Changes and Non-Material Changes.

Submitting Ownership Information through WCIRB Connect®

To notify the WCIRB of a change in ownership, an insurance professional or insurer should use the ownership information submission tool on WCIRB Connect to submit the ownership information to the WCIRB. The WCIRB no longer accepts ownership information submitted using WCIRB Form 601, Notification of Change in Ownership and/or Combinability of Entities Form. Learn more about using the ownership information submission tool on WCIRB Connect.