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Premium freeze: icare to hold rates for 3 million workers

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NSW state insurer icare has been instructed to keep its premium rates unchanged from June 30, saving businesses more than $325 million in an effort to boost confidence and stimulate the economy.

The icare workers’ compensation scheme protects 3.2 million workers across more than 325,000 businesses.

“The Government has deferred or waived a number of taxes, fees, and levies and I have asked icare to do the same,” NSW Treasurer Dominic Perrottet said.

The policy would “help keep businesses in business and people in jobs” by maintaining current premium levels across the board, on top of reducing insurance premiums for operations hit hard by the COVID-19 pandemic, Mr Perrottet said.

icare has already reduced premiums by $52 million for more than 10,000 businesses in anticipation of lower wages caused by closures and other measures to slow the spread of COVID-19. It has also paused more than $43 million in premiums for 2,000 customers facing financial hardship.

Along with the premium rate freeze, that added up to $420 million in financial relief this year for businesses.

icare NSW CEO John Nagle says premiums will be maintained at 1.4% of average base wages even as investment returns and icare’s funding ratio are hit by the economic downturn.

“We are able to absorb the initial impacts and rebalance the funding gradually in coming years as the economy recovers,” Mr Nagle said.

The NSW Government has also cut payroll tax, waived licensing fees and provided grants to pay for unavoidable expenses. The icare freeze ensures a higher insurance premium is one less thing businesses have to worry about, the Treasurer said.