What it does
WC 00 04 06 A (Ed. 7-95) tells the insured that premium for this policy, and any policies listed in Item 3, may be eligible for a discount. The estimated discount is shown either by state and premium layer (first $10,000, next $190,000, next $1,550,000, balance) or as an average percentage. The final discount is calculated from the manuals and the audited premium basis.
Key provisions
- Premium subject to retrospective rating is not subject to premium discount.
- Item 3 lists other policies combined for the discount. Item 4 points to another policy's discount endorsement when the discount is shown there.
- Carriers may replace the layer table with the table they use, or revise it to fit state rules.
Who needs it
Accounts whose standard premium is high enough to earn a discount. NCCI's Information Page notes allow the discount to be shown in Item 4, on this endorsement, or both.
Quoting and selling notes
- Confirm whether the quote shows premium before or after discount, and which discount table the carrier uses in Item 1.
- Discount is recalculated on audited premium, so a payroll increase can increase the discount and a decrease can reduce it.
- List every policy the manual allows to be combined for discount in Item 3.
- Accounts moving to a retrospective rating plan lose premium discount on the retro-rated premium.
Related forms
Information Page WC 00 00 01; retrospective rating WC 00 05 03.
