Retrospective rating insurance

Choosing a loss-sensitive workers’ compensation plan, such as a retrospective rating plan, can provide excellent value for a company. But the plan needs to make financial and cultural sense to take on that risk. Retrospective insurance plans tend to work best for employers with large workers’ compensation premiums, a stable financial situation, and historically reliable claims data. If you’ve dealt with high losses recently, however, or if you’re subject to catastrophic exposures, a retrospective rating plan may not be best. Our agents will work with you to help assess your situation and find the plan you need.

The actual rating formula is fairly complex, but the key component of retrospective rating plans is the fact that your premium is determined after the policy period concludes. It’s based largely on your claim history for that period. During the policy period, you’ll pay your premium, and we’ll handle your claims. In the months following the end of the period, we’ll make a retroactive adjustment to your premium based on the losses you incurred compared to expectations. As you can imagine, this is where a financially sound business dedicated to safety can see the benefits of this plan.

With a retrospective rating plan, your premium is directly affected by your claims losses for that period. The costlier the losses, the higher your premium. This means working with the right claims team is essential—not only for your employees’ well-being, but for your bottom line. At Sentry, our knowledgeable and experienced team understands the complexities of retrospective insurance plans, and they handle claims promptly and fairly.