Retrospective Rating Workers' Compensation Plans
Retrospective Rating Plans: Aligning Premiums with Performance
Retrospective Rating Plans (Retro Plans) offer a dynamic way to align your workers’ compensation premiums with your actual loss experience. These plans allow you to adjust premiums based on either incurred or paid losses, offering the potential for significant savings when your claims are well-managed.
Retro Plans provide flexibility, but they also require a robust understanding of your loss data and strong claims management practices. Liberty’s team is here to help you navigate these options to ensure you are maximizing your financial outcomes.
Types of Deductible Workers' Compensation Plans
Incurred Retro Plans
Premiums are adjusted based on the losses that are incurred during the policy period, including reserves.
- Flexibility in premium payments
- Potential for significant savings if losses are lower than expected
- No collateral is usually required, as the "loss fund" is paid inside the premium
- Strong claims management is needed to control reserves
- Premiums can rise if losses are high
- Premium returns may be delayed up to three years depending on plan design
Paid Retro Plans
Premiums are adjusted based on the losses that are actually paid out during the policy period.
- More predictable cash flow since only paid claims are considered
- Potential for savings if claims are settled efficiently
- No collateral is typically required, as the "loss fund" is included in the premium
- May result in higher premiums in the short term if claims are paid quickly
- Requires strong financial management
Find Your Ideal Workers' Comp Plan Now!
Is your current plan the best fit for your business? Answer a few quick questions to get a tailored plan recommendation with our free Workers’ Comp Plan Adviser tool.
Enhancing Your Retro Plan with Liberty’s Services
Liberty offers a comprehensive suite of products to enhance your deductible plan and reduce costs, improve outcomes, and ensure your retro plan is fully optimized for your business’s needs.
Proactive claims management
Data analytics
Risk control services
With over 150 years of collective experience, Liberty’s National Workers’ Compensation Practice delivers personalized support and strategic guidance. We leverage cutting-edge analytics to help you uncover hidden costs and ensure you’re in the optimal plan for your business.