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OPUJDF!UP!QPMJDZIPMEFS <br />DBMJGPSOJB!XPSLFST(!DPNQFOTBUJPO <br />JOTVSBODF!SBUJOH!MBXT <br />PrsanttoSection112.8ofteCaliforniaInsranceCode,weareproidingyowitaneplanationofte <br />Californiaworerscompensationratinglawsapplicaletonewandrenewalpolicieswitpolicyeffectiedatesonand <br />after anary 1, 199. <br />1.Telawsreiringallinsrerstocargetesameminimmrateniformlytoallemployerswitinagien <br />classificationaseenrepealed.Beginninganary1,199,wewillestalisorownratesforworers <br />compensation.Orrateswillnoteapplicalepriortotefirstnormalpolicyeffectiedateofapolicyinceptingonor <br />afteranary1,199.Orrates,ratingplansandrelatedinformationarefiledwitteInsranceCommissionerand <br />are open for plic inspection. <br />2.TeInsranceCommissionercandisapproeorrates,ratingplansorclassificationsonlyifeasdeterminedafter <br />plicearingtatorratesmigteopardieorailitytopayclaimsorcreateamonopolyintemaret.A <br />monopolyisdefinedylawasamaretwereoneinsrerwrites20ormoreoftatpartofteCaliforniaworers <br />compensationinsrancetatisnotwrittenyteStateCompensationInsranceFnd.Ifteinsrance <br />Commissionerdisapproesorrates,ratingplansorclassification,emayorderanincreaseinteratesapplicale <br />to otstanding policies. <br />3.RatingorganiationsmaydeelopprepremimrateswicaresecttoteInsranceCommissionersapproal. <br />Aprepremimratereflectsteanticipatedcostandepensesofclaimsper100ofpayrollforagien <br />classification.Prepremimratesareadisoryonly,aswearenotreiredtoseteprepremimrates <br />deeloped y any rating organiation in estalising or own rates. <br />4.Wemstaderetoasingle,niformeperienceratingplan.Ifyoareeligileforeperienceratingnderteplan, <br />wewillereiredtoadstyorpremimtoreflectyorclaimistory.Aetterclaimistorygenerallyresltsina <br />lowereperienceratingmodificationmoreclaims,ormoreepensieclaims,generallyresltinaigereperience <br />ratingmodification.Teniformeperienceratingplandeelopedyteinsranceratingorganiationdesignatedy <br />te Insrance commissioner is sect to te approal of te Insrance Commissioner. <br />.AstandardclassificationsystemdeelopedyteinsranceratingorganiationdesignatedyteInsrance <br />CommissionerissecttoapproalofteInsranceCommissioner.Testandardclassificationsystemisametod <br />ofrecogniingandseparatingpolicyoldersintoindstryoroccpationalgropsaccordingtoteirsimilaritiesand/or <br />differences.Wecanadoptandapplytestandardclassificationsystemordeelopandapplyorownclassification <br />system,proidedtatwecanreporttepayroll,epensesandotercostsofclaimsinawaywicisconsistentwit <br />te standard classification system. <br />6.Or rates and classifications may not iolate te nr Ciil Rigts Act or e nfairly discriminatory. <br />.Wewillproideanappealprocessforyotoappealtewaywerateyorinsrancepolicy.Teprocesswillreire <br />storespondtoyorwrittenappealwitin30days.Ifyoarenotsatisfiedwitteresltofyorappeal,yomay <br />appeal or decision to te Insrance Commissioner. <br />Gpsn!XD!77!13!16!B Printed in .S.A. <br /> <br />