Navigating NCCI's Ratemaking Resources

Posted Date: July 07, 2025

Ratemaking requires analyzing several key components, including on-levels, development, trend, and expenses. For each of these components, this Ratemaking Resource Guide will:

Highlight essential NCCI resources
Provide background information, definitions, and a video overview
Offer reference information related to NCCI rate filings

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For NCCI filing activity, see the latest Status of Rate Revisions on NCCI’s Circulars page.

For a detailed summary of filing information and data across all NCCI states, see the Summary of Loss Cost/Rate Filing Information exhibit.

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On-levels Development Trend Expenses

On-levels

ASB Exhibit 2 – Premium Level Changes (updated in March, June, November)

ASB Exhibit 3 – Benefit Level Changes (updated in March, June, November)

On-level factors adjust historical premium and loss data to the current premium and benefit levels, facilitating the comparison of data across different time periods. Historical premium and benefit level changes are the building blocks for calculating on-level factors, which can be found in ASB Exhibits 2 and 3. For the most recent premium and benefit level changes not yet incorporated into the ASB, reference the latest NCCI rate filing.

NCCI premium and loss on-level factors are calculated in Appendix A-I of each state’s annual rate filing. The factors are also available for reference in the Trend Information exhibit. Notably, NCCI-calculated premium on-level factors include other adjustments in addition to premium level changes. NCCI-calculated loss on-level factors reflect the benefit level changes approved in historical loss cost or rate filings. For each benefit change incorporated in the loss on-levels, a detailed analysis can be found in the filing where the benefit change was first introduced, typically in Appendix C.

Development

ASB Exhibit 9 – Unlimited Loss Development Factors (updated in March)

Loss Development Exhibits – (updated for each state shortly after NCCI submits the filing)

Development factors are used to project reported losses and premium to their ultimate levels. Loss development occurs as claim payments are made and case reserve estimates change. Since workers compensation is a long-tailed line of business, losses have the potential to develop for many years after an injury occurs. Premium development is primarily based on payroll audits. Similar to on-levels, the application of development factors facilitates the comparison of data across different time periods. Development triangles are available in ASB Exhibit 9 and the Loss Development Exhibits.

The development factors included in each state’s filing depend on the filing methodology and development selections leveraged in the state. For more details on NCCI’s development considerations and selections, refer to Appendix A-II of the applicable filing. A summary of high-level development selections for all NCCI states can be found in the Summary of Loss Cost/Rate Filing Information exhibit. The filing-specific age-to-ultimate development factors are also available for reference in the Trend Information exhibit exhibit.

Trend

Trend Information (updated for each state shortly after NCCI submits the filing)

Trend factors are necessary to account for how loss costs change over time; they are used to forecast the extent to which future experience will differ from historical experience. In workers compensation, loss ratio trend factors measure anticipated changes in the amount of indemnity and medical benefits as compared with anticipated changes in the amount of workers’ wages.

NCCI’s Trend Information exhibit provides the frequency, severity, and loss ratio calculations associated with each state’s rate filing trend analysis. Data adjustments such as on-leveling and development are necessary to perform a trend analysis; thus, certain components of the exhibit reflect NCCI ratemaking methodologies and selections for each state.

NCCI’s trend analysis and selections can be found in Appendix A-III of each state’s filing. The appendix details the various considerations and data adjustments, if applicable, underlying the trend selections. A summary of loss ratio trend selections across all states is included in the Summary of Loss Cost/Rate Filing Information exhibit.

Expenses

ASB Exhibit 6 – Taxes, Assessments, and LAE (updated in March, November)

Tax and Assessment Directory (updated monthly)

Underwriting Results by State (updated in March, October, December)

Loss Development Exhibits (updated for each state shortly after NCCI submits the filing)

Countrywide Expense Analysis (updated in July)

In ratemaking, expense provisions are necessary to ensure that premiums are adequate to cover the operational costs of the insurance company. Types of expense provisions include:

Loss Adjustment Expenses
Production and General Expenses
Taxes, Licenses, and Fees
Profit and Contingencies

Depending on the state, NCCI’s filed rating values may be loss costs or rates. In rate states, full rates are published to reflect all expenses in addition to the loss costs. In loss cost states, carriers must include any appropriate expenses in their filed loss cost multiplier to produce a full rate.

The resources listed can be used to:

Reference the expense provisions included in each state
Learn about some of NCCI’s filed expense provisions
Review historical expense ratios
Perform an independent expense analysis

The expense provisions included in NCCI filed rating values are located in Exhibit II of each state’s filing.

Other Resources