State Fund exists to provide fair pricing for the workers’ compensation needs of California employers. To support our mission, we will implement new procedures to improve the timeliness and accuracy of payments and premium deposits. These changes will help ensure that all policyholders are treated fairly and will help manage the overall cost of workers’ compensation insurance for employers.
Currently, we collect a premium deposit to establish coverage and then bill for premium throughout the policy year at regular intervals. Our payroll/billing procedures collect premium in arrears—after the coverage has been extended.
Going forward, State Fund will move to a multiple-payment stipulated billing cycle, which will require the first payment at policy renewal and a deposit. This deposit will roll over to the next policy term, providing continuous coverage.
Policyholders will also be required to complete two payroll reports: an interim payroll report six months into the policy period and a final payroll report due at the end of the policy term. Following the interim payroll report, the remaining premium billing statements may be adjusted to reflect current payroll information.
These new procedures will be applied to all new and renewal policies incepting on or after January 1, 2012.
We created an overview table showing the changes to deposit premium and billing that will be effective for all accounts by premium threshold.
State Fund has enhanced our online service tool, State Fund Online, to make it easier for you to make your workers’ compensation premium payments online, and to pay by credit card. You and your clients can register for State Fund Online today.
These new payment procedures bring State Fund into alignment with standard business practice and more importantly, they will enable State Fund to continue to protect California employers.
Note: Minimum premium policies will continue with premium deposits of no less than 100 percent of minimum premium. Estimated Annual Premium (EAP) will determine annual, semi-annual, or quarterly payroll reporting.
Professional Employer Organizations (PEOs), farm labor contractors, and temporary help agencies will continue to use payroll reporting to make payments, but deposit requirements will increase to 25 percent.
