A Primer on How The Hartford Calculates Your Rates
Understanding your premium bill is as important as understanding your policy.
How We Calculate A Blended Rate
The Hartford uses the policy base rates and premium to calculate a blended rate. Blended rates
are then applied to the payroll run each pay period on the basis of employee, state or class codes.
See example below:
See example below:
Understand The Terminology
- Base rate. This is the rate per $100 of remuneration (for example, payroll) that’s filed with the state, shown on your policy declarations and used to calculate premium by class code.
- All other payroll-based factors. These are items that increase or decrease the premium beyond the standard premium. Common factors may include, but are not limited to, state surcharges, catastrophe, minimum premium, experience modification, and terrorism.
Blended rate. This is a combination of the base rate and all other payroll-based factors. A blended rate is calculated for each state and class code on the policy. This blended rate is then applied to actual payrolls received to determine the premium to deduct each payroll period. Your policy will include a form that provides your blended rate(s).
Important: Policy Changes and Audit
As you make changes to your policy based on your business needs, the blended rate could change. This is because the standard premium or all other payrollbased factors can change as well. If your blended rate changes, you’ll receive this information with the policy change documentation.
All workers’ compensation policies are audited. Payroll billing does not eliminate the need for an audit, but it can greatly reduce premium variance at policy expiration. It’s important to remember that we calculate this rate using the policy estimates. If your actual payrolls vary drastically from the estimates, it’s beneficial to update the estimates on your policy. We’ll then recalculate the blended rate. At audit we’ll recalculate your blended rate based on the actual payrolls received throughout the policy period to develop the final premium.
The Hartford® is Hartford Fire Insurance Company and its affiliated property and casualty insurance companies, 690 Asylum Avenue, Hartford, CT 06115.
All policies must be examined carefully to determine suitability for your needs and to identify any exclusions, limitations or any other terms and conditions that may specifically affect coverage. In the event of a conflict, the terms and conditions of the policy prevail. All Hartford coverages and services described on this page may be offered by one or more of the property and casualty insurance company subsidiaries of The Hartford Financial Services Group, Inc. and may not be available to all businesses.
In California, this insurance is written by Sentinel Insurance Company, Ltd. (CA license #8701). In TX, this insurance is written by Sentinel Insurance Company, Ltd., Hartford Casualty Insurance Company, Hartford Lloyd’s Insurance Company, Hartford Underwriters Insurance Company, Twin City Fire Insurance Company, Hartford Accident and Indemnity Company and Hartford Fire Insurance Company. In WA, this insurance is written by Hartford Fire Insurance Company, Hartford Casualty Insurance Company, Hartford Accident and Indemnity Company, Hartford Underwriters Insurance Company, Sentinel Insurance Company, Ltd. and Hartford Insurance Company of the Midwest.