The environment that the WCB operates in is most easily understood
by studying the flow of money. While the Board has little or no
influence over these flows, they describe the reality that it must
deal with: payrolls are fixed, and costs are defined by the frequency
and severity of injuries.
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Asessable payrolls are the payrolls of all companies in
British Columbia covered by the Workmen's Compensation Act.
Assessable payroll is read from the left-hand scale, claim
costs from the right.
1947 may be the first year there was an assessable maximum. The
1947 Annual Report contains the first reference to assessable
payrolls: in a ten-year table of annual payrolls the 1947 payroll
is described as 'assessable' payroll whereas the payrolls for
the other nine years are described as 'ascertained' payrolls.
This ten-year series of payrolls appears on a 'rolling' basis
in prior annual reports. The payrolls in this table are described
as 'gross' in the 1933 and 1934 Annual Reports.
The average assessment is the amount, on average, that
a company pays to the WCB as an insurance premium. The actual
assessment rate paid varies depending on the general risk of the
industry and the specific accident experience of a company.
The calculated average equals assessment premiums and
penalties divided by assessable payrolls then multiplied by 100.
Since the only published figures include penalties, the assessment
rate calculated is a little higher than the actual preferred rate.
Claim costs are
the costs of accidents in the year they were accepted as a WCB claim.
Since some very serious accidents will continue to incur costs in
the following years, an actuarial estimate is made of future costs
and the full amount is charged to the fund in the year the accident
occurred.
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