Experience Rating: When ACC Levies Put on a Tiny Hat and Start Judging You
If ACC experience rating had a personality, it would be that advisor who turns up once a year, looks at your claims history, rearranges your budget, and says, “I’m not angry, I’m just disappointed.” Helpful? Sometimes. Dramatic? Fully committed to the role.
So, what is experience rating?
Experience rating is ACC’s way of adjusting some employers’ Work levies based on their workplace injury claims experience. In plain English: if your claims history looks better than others in your industry, you may receive a discount. If it looks worse, you may receive a loading. If it sits somewhere in the middle, ACC may nod politely, say “interesting,” and leave things exactly where they are.
The calculation looks at things like weekly compensation days, claims with medical and treatment costs over $750, and fatal claims. More recent years carry more weight, which means yesterday’s claims are not just in the room - they are standing on a chair with a microphone.
The percentage bands: tiny numbers wearing very serious shoes.
Experience rating uses percentage adjustments, which can mean a discount, no adjustment, or a loading. At the friendly end, businesses can receive a discount of up to 50%. At the less friendly end, loadings can go up to 100%. That is quite a range - from “lovely, we’ll take it” to “who gave this invoice caffeine?”
Big shifts towards discounts: not magic, but still worth checking for glitter.
A business can see a big shift towards a discount when older, expensive claims drop out of the experience period, when recent claims have been managed well, or when employees return to work sooner. Sometimes the levy calculation suddenly looks like it has joined a gym, downloaded a meditation app, and started saying things like “new year, new me.”
But before everyone starts high-fiving the invoice and calling it “bestie,” it pays to check the detail. A discount is excellent news, but unexplained movement deserves a second look especially if the claims history, liable earnings, business grouping, or industry classification has changed. Even good news should be asked for ID at the door.
What to check if things look wonky, suspicious, or like they were assembled during a fire drill:
Check the claims: Are the claims actually work-related, accepted, and linked to the right employer or business group, or has one wandered in wearing a fake moustache?
Review claims over $750: Confirm the medical and treatment cost threshold has been applied correctly. Small numbers can quietly become big numbers when nobody is watching.
Look at weekly compensation days: Long periods off work can have a major impact, so make sure the days recorded are accurate and not multiplying in the dark.
Check the experience period: ACC usually excludes the most recent year and looks at the three years before that, so make sure you are reviewing the right window and not peering through the neighbour’s curtains.
Confirm liable earnings: If liable earnings are wrong, the comparison rates can wobble like a café table with one short leg and a tragic backstory.
Check grouping and classification: Business groupings and industry classifications can affect the result, particularly where related entities operate across different activities. This is where spreadsheets sometimes put on disguises.
Check the Claims: Not all claims are created equal. We remove a lot of claims from our clients profiles due to being pre-existing injuries; reaggravations; motor vehicle; overuse injuries; ACC not following process; health issues driving days off; the list continues!