Frequently Asked Questions: Workers' Compensation Assessment Invoice Calculations
Topic
SELF History
Coverage Documents
Average District Attendance
WC Assessment Invoice Calculations
Rate
Annual SELF Underwriting Questionnaire
When is the Schools Excess Liability Fund Workers' Compensation Assessment billed?

The Assessment Policy dictates that SELF use the actuary data with claims valued at June 30 and the annual audit approved by the Board of Directors to issue the invoices. The approval of the annual audit will generally occur at the board's September or December meetings.
 

What is the assessment for?

SELF's actuarial projections indicate a developing, future unfunded liability. SELF's goal is to retain funds in the Excess Workers' Compensation Program sufficient to fund for expected discounted outstanding liabilities.
 

What are the factors used in calculating the assessment?

Three factors create the incurred adjustment balance and the outstanding adjustment balance:

1. Total assets as of June 30;

2. Incurred claims liabilities as of June 30;

3. Outstanding claims liability as of June 30.
 

What are "incurred claims liabilities"?

This is the figure from the June 30 loss statistics which represents the yearly amount of incurred reserves.
 

What are "outstanding claims liabilities"?

This is the figure in the Actuarial Review which represents the yearly total amount of reserves on open claims and Incurred But Not Reported (IBNR) claims and Unallocated Loss Adjustment Expenses (ULAE) stated at the selected confidence level, discounted or at present value.
 

What confidence level is used to calculate assessments?

SELF's Policies and Procedures Manual requires that "outstanding claims liabilities are stated at the expected (confidence level)". This is in accord with Paragraph 22 of the Governmental Accounting Standards Board (GASB) No. 10. The expected level is the best estimate on average of the ultimate loss settlement based on past loss payment patterns and expected future patterns.
 

Does the Assessment Policy have a provision for refunds?

In the pooled layer, a member shall be eligible for a refund, or credit, by meeting the following conditions:

a. Participation in the plan for three years;

b. Applicable program year results in a positive outstanding adjustment balance;

c. The amount to be refunded shall be a certain percentage of the "outstanding adjustment balance" as determined by the Board of Directors.
 

How is my district assessed in the pooled layer?

Assessments are billed by two criteria:

1. A member will be assessed if the "incurred adjustment balance" for the program year is negative. The amount of the assessment declared will be 100% of the deficit "incurred adjustment balance". The amount of the assessment will be collected over a period of not less than 7 years.

2. A member will be assessed if the "outstanding adjustment balance" for the program year is negative. The amount of the assessment declared will be 100% of the "outstanding adjustment balance". The amount to be declared annually will be determined as follows:

a. If the program year is 10 or more years past the expiration date, the amount of the assessment will be collected over a period of not less than 7 years.

b. If the program year is less than 10 years past the expiration date, the amount of the assessment will be annually declared, but not collected until the program year is more than 10 years past the expiration date.
 

Will the Assessment Policy be posted to SELF's Web site?

Yes. The policy, as it appears in SELF's Policy and Procedures Manual, can be found by clicking here.