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Self-insurer tiering: Panel and internal review process

Purpose

The Guide is intended to outline the State Insurance Regulatory Authority’s (SIRA) tiering process and to define the procedure for requesting an internal review of a tiering decision. It draws from and refers to SIRA’s Self-Insurer tiering model.

Background

In 2017, SIRA introduced formal tiering of Self-Insurers. Tiering allocations are informed by Self-Insurers’ conduct, claims management and financial ability. The tiering allocations will recognise acceptable and exemplary performance and identify those insurers who are not meeting SIRA expectations.

The tiering process

All Self-Insurers are formally tiered on an annual basis. Tiering may also occur at SIRA’s discretion in response to an event or risk.

The tiering process includes the following steps:

  1. The Portfolio Manager provides the Self-Insurer with their performance report and an indication of the Self-Insurer’s preliminary tiering recommendation based on the insurer’s recent performance.
  2. The Self-Insurer is given the opportunity to provide a submission or validate any data or material informing their performance report and to provide any information which may support a mid or top tier allocation.
  3. Following insurer validation and consideration of any further information, the Portfolio Manager will confirm the tiering recommendation with the Self-Insurer.
  4. The Portfolio Manager will provide the SIRA tiering panel with a tiering recommendation report which includes the Self-Insurer’s performance report and any further submission provided by the insurer.
  5. The tiering panel determines and communicates a tier allocation to each Self-Insurer as outlined in parts 4 & 5 of this guide.
  6. The tiering panel

    The tiering panel will be convened to ensure a consistent, objective analysis of a Self-Insurer’s performance. The panel will be comprised as follows:

    • Director, Insurer Performance (Chairperson)
    • Technical Manager, Insurer Performance
    • Manager, Claimant Outcomes
    • Manager, Compliance and Investigations

The panel will review the tiering recommendation reports and insurer submissions to determine, on the balance of evidence, the appropriate tiering allocation of each Self-Insurer. Where the panel decision is split, the final decision will be made by the Chairperson.

Communication of tiering allocation

SIRA will communicate the Self-Insurers’ tiering allocation as follows:

  • Top-tier insurers: SIRA will issue written notice of the decision.
  • Mid-tier insurers: SIRA will issue written notice of the decision.
  • Low-tier insurers: The relevant Portfolio Manager and, where appropriate, the Director, Insurer Performance, will meet with the Self-Insurer to communicate the decision and outline the necessary regulatory activities to ensure the Self-Insurer performance meets SIRA’s expectations. The decision will be confirmed by written notice to the Self-Insurer.

In any case where the tiering panel’s decision did not accord with the Portfolio Manager’s recommendation, the relevant Portfolio Manager and, where necessary, the Director, Insurer Performance, will meet with the Self-Insurer to communicate the decision.

Internal review

If a Self-Insurer believes their tiering allocation was based on incorrect application of criteria, internal review can be sought by requesting reconsideration of the tiering panel decision.

A request for reconsideration must be made within 28 days of SIRA’s written communication of the formal tiering allocation to the Self-Insurer.

A request for reconsideration should be forwarded by email to self&specialisedinsurers@sira.nsw.gov.au.

The request must include submissions which address the:

  • tiering allocation the Self-Insurer asserts is appropriate
  • applicable criteria and
  • data or other information supportive of the applicable criteria being met.

The internal review will not involve the original decision makers. It will be conducted by SIRA’s Executive Director, Workers and Home Building Compensation Regulation and such other person(s) with the requisite internal expertise having regard to the circumstances of each case.

Following internal review, the Executive Director, Workers Compensation and Home Building can either:

  • affirm the original decision; or
  • set aside the original decision and substitute a new decision.

Within 28 days of SIRA receiving a request for reconsideration, the Director Insurer Performance will respond in writing to the Self-Insurer advising the outcome of the internal review. Where appropriate, the Executive Director, Workers and Home Building Compensation Regulation and / or Director Insurer Performance, may set a meeting with the Self-Insurer to discuss the outcome of the internal review prior to issue of the final determination of the internal review.

SIRA’s decision on the internal review is final and no further formal review or appeal is available

Publication of results

Following the completion of the internal review period, the tiering allocation of all Self-Insurers will be published on SIRA’s website.