Users say – occupational accident insurance providers: the Incomes Register has potential if data is reported correctly
9/6/2021In the field of occupational accident insurance, the Incomes Register’s data is used to determine insurance premiums.
‒ In concrete terms, the effect of the Incomes Register can be seen in that employers no longer need to fill in one more form, provided that the data required for determining accident and occupational disease insurance premiums has been entered in the Incomes Register, says Teemu Kastula, lawyer at LocalTapiola General Mutual Insurance Company, one of the providers of statutory accident and occupational disease insurance.
For occupational accident insurance providers, it is important that data about the occupational class is provided on every employee’s earnings payment report. The occupational class must match the correct work-related risk so that insurance premiums can be determined correctly. The reported occupational class is also used in statistics and labour protection.
The type of insurance is another important piece of data for occupational accident insurance providers. If income is excluded from insurance premiums based on the type of insurance, the insurance provider will determine insurance premiums incorrectly. Incorrect insurance premiums do not protect the interests of insured employees or correspond to the correct accident and occupational disease risk. Incorrect data also has an impact on reimbursements if correct data is not available for determining compensation for an employee’s loss of earnings.
‒ If accident and occupational disease insurance needs to be taken out for an employee, the “Not subject to accident insurance and occupational disease insurance contribution” option cannot be used as the type of insurance. Instead, self-employed persons with YEL insurance are not subject to insurance premiums of statutory accident and occupational disease insurance, and they must provide “No obligation to provide insurance (accident and occupational disease insurance)” as the type of exception to insurance on their report, says Kastula.
If an employer has several accident and occupational disease insurance policies, they must also report the policy number and pension provider code. If this data is missing, income cannot be allocated to the correct insurance premium. If a policy transfers from one insurance provider to another, the changed insurance data must be reported to the Incomes Register.
Complementary data is often required for compensation processing
In processing compensation for occupational accidents and diseases, the Incomes Register’s data is used to determine the amount of compensation for loss of earnings. Earnings payment data affects the amount of the daily allowance or occupational accident pension paid.
However, the lack of the data required is a challenge in using the Incomes Register’s data in the processing of compensation. Often, the data that is required is complementary in full or in part, meaning voluntary data submitted to the Incomes Register that employers may not always report. In addition, the provisions of the Workers’ Compensation Act on compensation for loss of earnings are not fully compatible with the Incomes Register, which is why separate additional data is nearly always required from employers, also for determining compensation.
‒ The Incomes Register practically gave us a new data source alongside the previous ones because, as a rule, we always require additional data from employers to determine compensation for loss of earnings. Instead, the Incomes Register’s data can be used quite painfully to determine insurance premiums, provided that data has been submitted correctly to the Incomes Register, says Kastula.
Kastula encourages all data providers to submit all payment data at the same time and as accurately as possible, that is, using reporting method 2. They should also report all complementary data, such as employment and absence data.
‒ It is good to know that the earnings payment data submitted to the Incomes Register affects not only insurance premiums, but also compensation for insured employees’ loss of earnings. Ultimately, reporting data correctly and correcting any errors is important to ensure that a person injured in an occupational accident receives correct compensation for their loss of earnings.
The Incomes Register ensures the even quality of data
Now, wages paid only need to be reported once to the Incomes Register, from where the data is distributed to the data users who need it. This ensures the even quality of data, as occupational accident insurance, unemployment insurance and earnings-related pension providers, the Finnish Tax Administration and the Social Insurance Institution of Finland, for example, have access to identical earnings payment data.
‒ Earnings payment reports have very far-reaching effects. Wages reported to the Incomes Register affect not only employees’ taxes, but also their social security contributions, says Kastula.
Several parties having access to identical data reduces the possibility of misuse. The Incomes Register’s data users are responsible for ensuring the correctness of data from their respective sector’s perspective. Occupational accident insurance providers supervise that employers who have taken out insurance fulfil their obligations set out in the Workers’ Compensation Act, including the reporting of earnings payment data that affects insurance premiums.
‒ When investigating a potential mismatch in earnings payment data, there often is a human reporting error. Of course, technical errors are also possible but, luckily, we have not encountered many cases of misuse, Kastula says, and continues that reporting is learned by doing.
Reporting data should be simple
The accuracy of data is also vital for occupational accident insurance providers. To make it easy to report data, reporting and related instructions should be as simple as possible.
‒ Considering the development of our activities, the quality of the data reported to the Incomes Register is key. According to the general estimate by the Finnish Workers’ Compensation Center, the situation has improved. Roughly speaking, some 5 to 10 per cent of all earnings payment reports still include errors and incomplete data.
Kastula would like to see more technical checks in the Incomes Register concerning the policy number, for example. Technical checks would guide users to report data correctly and also ensure that data is transferred correctly to data users.
- In certain situations, we have noticed that it is possible to report very long pay periods that start very far in the past. Similarly, there can be structural errors that need to be investigated.
Occupational accident insurance providers hope that the Incomes Register continues to be developed together with data providers and users. In terms of development, cooperation always means finding a balance between data providers and users, also considering how each data user could use the Incomes Register’s data even better.
Kastula sees that practice is the best teacher in such a complicated change. Experience helps to perceive how the data available in the Incomes Register can be optimally used in different sectors.
‒ From the occupational accident insurance providers’ perspective, development needs partly depend on how our legislation develops, meaning the data the law requires us to obtain, say, for determining compensation for loss of earnings. This also determines what development needs or potential the Incomes Register has in the processing of compensation.
In the Users say series, organisations that use the Incomes Register’s data talk about the benefits and challenges of the use of data from their own perspectives.
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