The unfunded liability (UFL) represents the shortfall between the money needed to pay the future benefits to workers for all established claims, and the money that is in the accident fund.
The government has recognized that the elimination of the UFL is an important goal and have legislated a three stage plan for achieving full funding. The WSIB must reach at least 60% funding by 2017, 80% funding by 2022 and 100% funding by 2027.
This paper outlines the proposed preliminary Rate Framework's recommendation on how the unfunded liability could be reasonably apportioned to specific classes.
While the NCC method does not consider past responsibility for the UFL, it is directionally consistent with Method 2 which strikes a more appropriate balance between reflecting past responsibility for the UFL and ensuring that classes do not experience unreasonable UFL charge increases in the majority of cases.
The WSIB would like to hear from you! Please email us your questions or comments about the proposed preliminary Rate Framework to email@example.com.
For more information, see Paper 4: The Unfunded Liability (PDF)