Ariz. Admin. Code § R20-5-1534 - Premium Rates; Deviation Rates
A.
Annually, by September 15, premium calculation rates and a schedule of
Deviation Rates shall be calculated and approved by the Commission at a public
rate hearing. The premium calculation rates and the schedule of Deviation Rates
shall be effective the following calendar year.
B. The Deviation Rate applicable to a
Self-Insurer relates directly to the Self-Insurer's safety record, which is
measured by the SelfInsurer's Experience Modification Rating specific to
Arizona for the prior year. The schedule of Deviation Rates will include the
Experience Modification Rate ranges that apply to each Deviation
Rate.
C. The Experience
Modification Rate for purposes of determining the Deviation Rate shall be
calculated as follows:
1. In the first year of
self-insurance, the Experience Modification Rate is set at 1.00;
2. In the second and third years of
self-insurance, the Division calculates the Experience Modification Rate based
upon the payroll and loss data accumulated by the Self-Insurer during its
entire term of self-insurance; and
3. In the fourth year of self-insurance and
all following years, the Division calculates the Experience Modification Rate
based upon the payroll and loss data of the prior three tax years.
D. If the Division cannot
calculate an Experience Modification Rate in the second and all following years
because the Self-Insurer does not have any injuries, the Self Insurer shall
receive the highest Deviation Rate.
E. The lowest Deviation Rate included in the
schedule of Deviation Rates shall not be less than 10%.
Notes
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