Ariz. Admin. Code § 20-5-1534

Current through Register Vol. 30, No. 49, December 6, 2024

Section 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%.

Ariz. Admin. Code § R20-5-1534

New section made by final rulemaking at 28 A.A.R. 3435, effective 10/5/2022.