Research Of Experience Modification Rating For Worker’s Compensation Insurance

Worker’s compensation insurance system is one of the most important social security systems. In China, it has a history of about60years. During this period, worker’s compensation insurance has developed a lot. Now there are more than0.19billion workers are among in the system, and more and more workers who can benefit the financial subsidy nowadays. The framework of the worker’s compensation insurance system has been formed, including injury prevention, compensation and recovery.But compared with the developing countries, such as Germany, America, there are still a lot for our worker’s compensation insurance to improve. Experience modification rating (EMR) is one of them. EMR means that the compensation rate changes along with the time. The employer with lower payment rate and accident rate will have lower the rate, while the employer with higher payment rate and accident rate will higher the rate. According to this, experience modification rating will encourage employer to improve work environment, to make sure the employees work in safe situation. Nowadays, EMR in our country is unscientifically. Establishing an effective rate system is one goal of the worker’s compensation insurance system.According to different countries and districts experience, this paper tests the relations between payment rate, accident rate with manual rate, and finds out the key factors that affect the EMR, including payment rate and accident rate. According to the research result, in this paper, payment rate, accident rate are used as the influence index, according to Dalian city government’s suggestions, death number is regarded as the adjust indicator. In this paper, the basic principle for the EMR is described as below:For the low pay rate employers, payment rate, accident rate and death number are taken into account, while for the high pay rate employers, only pay rate and death number are considered."Pay rate-Accident rate" as two influence indicators and death number as adjust indicators floating rule is proposed in this paper to calculate the EMR.Dalian city’s worker’s compensation insurance data are used as the sample, including five years data, from2006to2011. This paper use K-means clustering algorithm as the key method and SPSS as the key tool to analysis data, in the first step, pay rate and accident rate’s critical value are worked out, use the critical values to make a grid, K-means clustering is used again to get the final float range. Finally the EMR rule is worked out. Then the sample data are used again for the rational examination, including one year floating and continuous floating. As the result shows, the EMR rule in this paper are reasonable both in the injury accident prevention function, keeping the fund stabilization and also keeping the fund equitable.