Expense Loss Cost Multiplier Worksheet For Group Sel-Insurance Fund {LIBC-351}

DEPARTMENT OF LABOR & INDUSTRY BUREAU OF WORKERS' COMPENSATION EXPENSE LOSS COST MULTIPLIER WORKSHEET FOR GROUP SELF-INSURANCE FUND USING RATING ORGANIZATION LOSS COSTS MULTIPLIER CALCULATION WORKSHEET AND INSTRUCTIONS Name of fund: Address: City/Town: Insurer code: Fund officer responsible for this filing: Title: Telephone: Email address: Fund Year the multiplier calculated in this worksheet covers: From MM State: ZIP: Firm: Ext: Fax: DD YYYY To MM DD YYYY INSTRUCTIONS The following worksheet provides specific parameters for filing an expense loss cost multiplier and an overall contribution rate in compliance with 34 Pa. Code § 125.135 for the upcoming fund year. THIS WORKSHEET IS FOR USE BY FUNDS USING RATING ORGANIZATION LOSS COSTS. Nothing in the worksheet, these instructions or actuarial guidelines should be construed as placing an upper limit on the degree of additional conservatism that is determined necessary in creating and maintaining adequate surplus for the support of the fund's inherent asset and liability risks. This worksheet and all supporting material must be received by the Bureau of Workers' Compensation no later than 45 days prior to the beginning of the upcoming fund year. Do not deviate from the instructions for each line of the worksheet. The worksheet assumes that (1) no other rate change has been/is being filed for the upcoming fund year; (2) the fund membership for the upcoming year is relatively known, and (3) that the rating organization loss costs being used for the upcoming year are those, as of the form's submission, approved "to be in effect" for insurance company members of the rating organization as of the start of the upcoming fund year. Please contact the Self-Insurance Division, Bureau of Workers' Compensation, 1171 S. Cameron St., Harrisburg, PA 17104-2501, 717-783-4476, if these assumptions are not valid for the fund. The worksheet exhibits should be uploaded as an EXCEL document. Please note that once the bureau approves the loss cost multiplier for the upcoming year, the fund must complete and file an ANNUAL CONTRIBUTION WORKSHEET (LIBC-350) on each member. Although an actuary is not required to complete the worksheet, use of an actuary is recommended, as in any situation involving the calculation or preparation of rates. LIBC-351 REV 09-13 (Page 1) American LegalNet, Inc. www.FormsWorkFlow.com LOSS COST MULTIPLIER CALCULATION WORKSHEET FOR GROUP USING RATING ORGANIZATION LOSS COSTS A. LOSS COST CONTRIBUTION (in dollars) A. · Create an exhibit which includes the following fields for each expected member during the upcoming fund year: · · · Rating Organization Classification The exposure of the member (e.g., $100 of payroll) The loss costs for the classification · Multiple rows of such fields must be included for members with exposure in more than one classification. (The ANNUAL CONTRIBUTION WORKSHEET, LIBC-350, provides guidance for this exhibit.) Multiply exposure by loss costs and enter into this box the sum of all the products for all members. · Based on its experience, the fund should consider loss costs at a greater level than the approved rating organization loss costs to avoid deficit funding. B. STANDARD CONTRIBUTION (in dollars) · Additional Columns should be added to BOX A's exhibit which show: · · The member's experience modification, according to rating organization formula and manual calculated based upon that member. The member's "Standard Contribution" (in dollars) which is the loss cost contribution multiplied by its experience modification. B. · The sum of each member's standard contribution gives the Fund's total Standard Contribution. · The sum does NOT include any discounting for time value of money, allowances for income from (nor any transfer of) earlier fund years' surplus, credits, expenses, or expense constant. C. ADJUSTED PROJECTED EXCESS INSURANCE PREMIUM GROSS OF EXCESS LOSSES (in dollars) C. · The premium may not be reduced by the losses expected to be covered by the excess insurance. · Attach an exhibit or other information explaining the amount of estimated gross excess insurance premium, e.g., a written premium quote. · D. The premium must also be entered in Part 1, Line A of the attached EXPENSE EXHIBIT form. D. ADJUSTED PROJECTED VARIABLE EXPENSE (in dollars) · Complete the attached EXPENSE EXHIBIT form. The adjusted projected variable expense is taken from Part 1, Line E of that form. E. ADJUSTED PROJECTED FIXED EXPENSE (in dollars) E. · The adjusted projected fixed expenses are taken from Part 2, Line D of the EXPENSE EXHIBIT form. NOTE: This is net of expense constant. F. EXPENSE CONSTANT COMPONENT OF CONTRIBUTION · This is taken from Part 2, Line C of the EXPENSE EXHIBIT form. G. CONSERVATIVE ESTIMATE OF DEFICITS (as negative amount) FROM THE CURRENT AND PREVIOUS LOSS YEARS. G. F. · Create an exhibit showing the amount of any known surplus for each loss year the fund has existed. "Surplus" refers to a loss year's collected premium (and accrued investment income) after subtracting of ultimate losses and expenses (including the dividends already approved for that loss year). · Estimates produced (within the last 12 months) by an actuarial report is preferable, especially if a discounted estimate at 75 percent or higher confidence level was used. Estimates of the surpluses for each of the prior loss years should have been produced at least as recently as the latest fiscal year report. If no such analysis has been created for the current loss year the exhibit will be limited to only prior years. · If the sum of the exhibit's surpluses is negative, then enter that negative sum into BOX G and submit the exhibit with this form. · If the sum of such surpluses is positive or zero, then enter 0 into BOX G and submit the exhibit with this form. LIBC-351 REV 09-13 (Page 2) American LegalNet, Inc. www.FormsWorkFlow.com BOX G NOTE: Box H BOX I NOTE: BOX J NOTE: BOX K BOX O BOX B Box O BOX O - - BOX O BOX O LIBC-351 REV 09-13 (Page 3) American LegalNet, Inc. www.FormsWorkFlow.com EXPENSE LOSS COSTS MULTIPLIER WORKSHEET FOR GROUP SELF-INSURANCE FUND USING RATING ORGANIZATION LOSS COSTS EXPENSE EXHIBITS AND INSTRUCTIONS FOR COMPLETING BOXES D AND E OF THE WORKSHEET INSTRUCTIONS The following exhibits are used to calculate a group self-insurance fund's projected annual adjusted variable expenses and adjusted fixed expenses for inclusion in the submission of its LOSS COST MULTIPLIER WORKSHEET (LIBC-351). THESE EXHIB