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2019 criteria for charges payable for accidents

The statutory accident insurance is based on the Workers’ Compensation Act, which became valid in 2016. According to the act, employees are entitled to compensation for any accidents occurring at work or occupational diseases caused by work. The state does not have this obligation to insure, but government employees do have the same right to claim statutory compensation, which will then be paid by the State Treasury. Section 2a of the Act on the State Treasury (305/1991) decrees that these compensation payments produced by the State Treasury are subject to a fee paid by the agencies. The proportion in which the fees are charged from the agencies is decreed in the government criteria for charges payable for accidents (VK/949/08.00.99/2017). According to law, the total amount of the fees must cover all of the expenses to the government, but the annual fee does not have to correspond to the compensation paid in the space of one year. The determination of the payments subscribes to principles of matching and equity. According to the principles, the payments should primarily be directed to the agency whose operations have caused the compensation expense, but within reason.

The expenses are divided between agencies

The criteria for charges payable determine the manner and formulae which are used to divide the expenses for accidents and the resulting treatment between agencies. In addition to government agencies, accident fees are charged from two enterprises: Metsähallitus and Senate Properties. The accident premium consists of a risk premium, compensation for treatment expenses and a refund for the accrued balance. The claims expenditure affects the risk premium, and the treatment cost coefficient is determined by the costs accumulated by the treatment related to the accidents. The refund for the accrued balance is used to balance the difference between payments and realised compensation from previous years.

Five risk categories for divisions

Each agency is governed by a division, and these divisions are categorised into five different risk categories according to how risky the work supervised by the division is, or more precisely, how large the total claims expenditure in the agencies in the division in question is. A specific payment per mill is calculated for each of these five risk categories. The risk categories of the agencies are reviewed annually. The calculation of the agencies’ risk premiums has been made as simple as possible. The objective is to charge reasonable compensation expenses from agencies. This is why a deductible coefficient is employed in the calculation of the charges. This coefficient illustrates how much the agency’s own claims expenditure affects the payment, and what the proportion of payments based on the larger risk category is. The deductible coefficient is affected by the size of the agency, i.e. the amount of wages paid: the larger the agency, the larger the deductible coefficient. The minimum deductible coefficient is 30% and the maximum deductible coefficient is 90%. If an agency’s deductible coefficient is 40%, for example, 40% of the payment will be based on the agency’s own claims expenditure, and 60% on the risk category claims expenditure. This balances the effect that large, individual cases of damage might have on the charges.

Attenuation and refund coefficients

In order to prevent large fluctuations in claims expenditure from affecting annual charges dramatically, an attenuation coefficient of 30% is also employed in the calculations. The attenuation coefficient ensures that premiums differ from the premium of the previous year by 30% in either direction, at most. Because the aim is to charge claims expenditures from agencies as accurately as possible, the calculation of the charges also incorporates a refund coefficient for the balance system. The balance system is used to monitor the amount of compensation forwarded from the agencies and the amount of incoming payments paid by the agencies in the long term. This is balanced annually, i.e. if an agency has paid more than they should, the balance refund coefficient is used to refund some of the payments to the agency. However, if an agency has paid too little, the balance refund coefficient is used to collect more payments in order to claim the necessary amount of incoming payments.

Calculations based on plenty of data

The payments for an individual year can never correspond to the actual calculated amount or the amount needed, because the accident premiums for 2019, for example, are calculated based on the payroll information from 2017 (the wages have been adjusted to the estimated 2019 level based on the consumer price index). Palkeet invoices the actual accident premiums from agencies from the realised wages from 2019, which cannot be determined yet. This is one of the reasons why a balance system is needed.

The following information is needed when calculating accident premiums:

  • accident compensation paid by agencies in 2014–2017
  • wages paid by agencies in 2014–2017
  • consumer price indices for 2018 and 2019
  • information from the balance system, i.e. the amount of overcharged/uncharged compensation from agencies and enterprises

Once all of the information has been received, and the programs used for the calculation have been updated with new information for the year 2019, the first estimated premiums are calculated and checked against the previous year. Should the risk category payment coefficients be reviewed, or should an agency be transferred to another risk category? Is there a need to change the criteria for charges? Is there a need to update the constants determined by the criteria for charges? It was decided that the constants in the criteria for the 2019 charges will remain the same as in 2018. Accident premiums will be re-calculated next autumn (2019) based on the claims expenditure from 2015–2018.

Payment per mills by accounting unit

Since 2018, payments have been calculated on the accounting unit level instead of the previous agency level. This means that each accounting unit receives its own payment per mill, which is based on the shared claims expenditure of the accounting unit (and the claims expenditure for the risk category in question). The charges paid by enterprises are only based on their own compensation records. The premium for cover corresponding to group life insurance is also collected in connection with the accident premium (financial support premium) and the occupational health and safety premium. The occupational health and safety premium is 0.23 per mill of the amount of wages. In 2019, the financial support premium is 0.232 per mill of wages. The total per mill is the sum of the accident per mill, financial support per mill and the occupational health and safety per mill.

Accident per mills and total per mills by accounting unit:

Accounting unit Name of accounting unit Accident per mill Total per mill
110 Parliament of Finland 1.809 2.271
111 National Audit Office of Finland 2.220 2.682
112 Finnish Institute of International Affairs 1.186 1.648
120 Office of the President of the Republic of Finland 2.537 2.999
125 Prime Minister’s Office 2.236 2.698
130 Ministry for Foreign Affairs 1.437 1.899
150 Ministry of Justice 2.487 2.949
151 Criminal Sanctions Agency 7.416 7.878
200 Ministry of the Interior 2.250 2.712
201 Finnish Border Guard 12.009 12.471
213 State Department of Åland 1.723 2.185
217 Finnish Security Intelligence Service 5.645 6.107
220 Emergency Services College 1.716 2.178
224 National Police Board of Finland 9.568 10.03
232 Finnish Immigration Service 2.596 3.058
248 Emergency Response Centre Administration 3.947 4.409
250 Ministry of Defence 5.471 5.933
251 Finnish Defence Forces 7.453 7.915
252 Construction Establishment of Finnish Defence Administration 18.512 18.974
300 Ministry of Finance 1.602 2.064
301 State Treasury 2.253 2.715
302 Finnish Customs 4.907 5.369
305 Tax Administration 1.543 2.005
306 VATT Institute for Economic Research 1.197 1.659
308 Population Register Centre 1.680 2.142
309 Finnish Government Shared Services Centre for Finance and HR 2.670 3.132
320 Government ICT Centre Valtori 1.229 1.691
321 Statistics Finland 2.046 2.508
360 Regional State Administrative Agency for Southern Finland 3.538 4.000
380 Development and Administrative Centre for the ELY Centres and TE Employment and Economic Development Offices 3.250 3.712
402 National Land Survey of Finland 2.142 2.604
410 Natural Resources Institute Finland 5.427 5.889
430 Finnish Food Authority 5.898 6.360
440 Ministry of Agriculture and Forestry 3.395 3.857
450 Ministry of Transport and Communications 1.952 2.414
456 Finnish Transport Infrastructure Agency 11.092 11.554
457 Finnish Transport and Communications Agency 1.355 1.817
494 Finnish Meteorological Institute 2.297 2.759
495 Finnish Transport and Communications Agency 2.083 2.545
504 Geological Survey of Finland 6.969 7.431
507 Finnish Patent and Registration Office 1.873 2.335
509 Finnish Funding Agency for Innovation Business Finland 2.731 3.193
513 Finnish Safety and Chemicals Agency 1.757 2.219
518 Energy Authority 2.028 2.490
519 Finnish Competition and Consumer Authority 1.950 2.412
540 The Ministry of Employment and the Economy 2.988 3.450
550 Ministry for Social Affairs and Health 2.317 2.779
555 Radiation and Nuclear Safety Authority 2.541 3.003
558 Finnish Medicines Agency Fimea 2.056 2.518
561 National Institute for Health and Welfare 4.432 4.894
562 National Supervisory Authority for Welfare and Health 1.737 2.199
563 Social Security Appeal Board 2.224 2.686
600 Ministry of Education and Culture 2.122 2.584
603 National Archives of Finland 2.022 2.484
605 Academy of Finland 2.611 3.073
606 Finnish Heritage Agency 2.525 2.987
607 Governing Body of Suomenlinna 8.015 8.477
660 Finnish National Agency for Education 3.833 4.295
700 Ministry of the Environment 1.765 2.227
701 Housing Finance and Development Centre of Finland 1.193 1.655
702 Finnish Environment Institute 2.526 2.988

Example: The State Treasury’s accident per mill is 2.253. Thus, the total per mill of the State Treasury is 2.253 + 0.232 + 0.23, i.e. 2.715. For more information on the determination of accident premiums please contact henna.honkanen [at]

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