Workers Compensation – What does it cost?

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According to Safe Work Australia’s ‘Key Workers’ Compensation Information Australia 2013 Report’*, in the year 2010-11 there were 127,330 serious workers’ compensation claims involving one or more weeks of time lost from work, a permanent incapacity or fatality. This equates to 12.2 claims for serious injury for every 1000 employees.

According to the report, in 2010-11 the total amount paid by workers’ compensation schemes was $7.4 billion.

 

This consisted of:

  • $4.09 billion of direct payments (incapacity, permanent impairment and common law) (54.9%)
  • $1.71 billion in medical and other services, including rehabilitation (22.9%)
  • $1.31 billion of insurance operations costs (17.6%), and
  • $343 million of other administrative costs (4.6%).

Premiums are usually expressed as a percentage of the employer’s payroll. The standardised average Australian premium in 2010-11 was 1.49%. However, for individual employers premiums can be as high as 12.2% for certain high risk trades or lower than 0.2% for low risk work.

Table 3 ” Australian workers’ compensation statistics, 2010-11*

 

Jurisdiction
Employees Covered
Fatalities
Serious Claims1
Incidence Rate2
Frequency Rate3
Durable RTW Rate4
Disput Rate5
Standardised Average
Premium Rate
NSW

3,165,700

44

43 280

13.7

8.1

78%

3.9%

1.76%
VIC

2,643,300

24

23 760

9.0

5.5

76%

10.0%

1.35%
QLD

1,965,200

34

28 910

14.7

9.0

76%

3.1%

1.22%
WA

1,094,100

29

13 110

12.0

7.0

N/A

3.1%

1.14%
SA

729,700

13

9 000

12.3

7.6

70%

6.6%

2.49%
TAS

209,000

4

3 270

15.6

10.2

80%

5.9%

1.50%
NT

115,000

3

1 290

11.2

6.2

77%

5.0%

1.79%
ACT

132,300

1

1 720

13.0

8.3

N/A

N/A

2.05%
Comcare

377,800

17

2 790

7.4

4.1

81%

3.4%

0.92%
Seacare

4,800

0

200

41.8

9.7

74%

17.8%

3.49%
Australia

10 437 000

169

127 330

12.2

7.3

77%

4.8%

1.49%
 
1. Serious claims include all claims for which one or more weeks of compensation has been recorded (excluding journey claims).
2. Incidence rate of serious injuries (the number of claims per 1000 employees, projected 2010-11*).
3. Frequency rate of serious injuries (the number of claims per million hours worked, projected 2010-11*).
4. The durable RTW (return to work rate is the proportion of injured workers who have returned to work and were still working at the time of interview in a survey conducted by Campbell Research and Consulting, seven to nine months after their claim.
5. A new definition for dispute rate, which is designed to improve comparability between jurisdictions was implemented in CPM 14. The number of active claims in the reference financial year rather than new claims lodged in the reference financial year are used to calculate disputation rates.
*Preliminary claims are projected based on previous year’s growth rate.

Does this data worry you? Is your organisation at risk?

Safety Dimensions supports leaders to do what’s required to tangibly change organisational safety behaviour, enable compliance and due diligence. We know how important it is to create a sustainable safety culture that gives your people the right skill sets, mind-sets and tools that enable tangible success rather than just putting more ˜rules’ or paper trails in place.

Our approach increases engagement at all levels, ensures corporate governance, reduces LTIs and work cover claims and most importantly, gives workers and organisations the skills to return each person home safely each day.

If you would like to speak to us about how we can help, call us on 03 9510 0477 or email [email protected]

 

*This data was used under a Creative Commons 3.0 Australia Licence from Safe Work Australia’s ‘Key Workers’ Compensation Information Australia, 2013’ www.swa.gov.au
 
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