Workers compensation insurance in NSW: icare, premiums and the rules

icare, SIRA and who manages your claim

NSW separates the roles. icare manages the Workers Compensation Nominal Insurer, which it calls Workers Insurance: it issues policies, collects premiums and pays for claims. It engages insurers to manage claims day to day, and at the time of writing those are EML, Allianz, GIO, Gallagher Bassett and QBE. SIRA is the regulator, setting the rules and supervising everyone in the scheme, including icare.

Two smaller groups sit outside icare. Specialised insurers are licensed by SIRA to insure employers in specific industries, and large employers can be approved by SIRA as self-insurers that manage their own claims. For almost every small business, the policy comes from icare.

Who must have a workers compensation policy in NSW

icare says an employer only doesn't need a policy if it meets all three conditions: it pays $7,500 or less in wages in a financial year, doesn't hire an apprentice or trainee, and isn't a member of a group of businesses. Miss any one and you need cover. A single apprentice on low wages is enough.

Timing matters in NSW. icare says a policy can't be backdated: cover starts when it is issued. Take out the policy before a new worker's first shift, not after the first payroll.

How NSW premiums are calculated

Every employer's starting point is the Average Performance Premium (APP), previously called the Basic Tariff Premium: your wages multiplied by the premium rate for your Workers Compensation Industry Classification (WIC). What happens next depends on the size of that figure.

If your APP is $30,000 or less, you're a small employer and your premium won't change with the number of claims you make. Small employers with no claims in the past three years that have lodged their wage declarations on time can also receive a Safe Employer Reward. If your APP is above $30,000, your premium is experience-rated, meaning your claims history moves it up or down.

For 2026-27, icare has kept WIC rates at their 2025-26 levels: icare says the Workers Compensation Legislation Amendment (Reform and Modernisation) Act 2026 freezes premium rates for 2026-27 and 2027-28. It also cut the cap on premium increases for experience-rated employers from 30% to 25% for policies starting on or after 30 June 2026, and kept the minimum premium at $240. Your premium can still change with your wages, business activity and claims. icare doesn't publish a single scheme-wide average rate the way some states do, so the way to know your cost is a quote based on your WIC and wages.

icare WIC rates 2026-27 for common industries

Your premium starts with your wages multiplied by the rate for your Workers Compensation Industry Classification (WIC). icare publishes every rate each year; these are the 2026-27 rates for common small-business industries, including the aged care and community care classes, with the starting figure on $100,000 of wages. Experience-rated employers and those eligible for incentives pay more or less than this.

When a worker is injured: the employer's obligations

icare says that when you become aware of a work-related injury, you must make sure your insurer is notified within 48 hours. You can notify icare's claims service provider online, by phone, email or post. Keep a register of injuries in a readily accessible place in the workplace, even when an injury doesn't lead to a claim; there are penalties for not keeping one.

Larger employers carry more. icare says Category 1 employers, those with an average performance premium over $50,000 a year, or self-insured or specialist-insured with more than 20 employees, must have a return to work program within 12 months and appoint a return to work coordinator. The 2026 reforms also introduced an excess that employers pay at the start of a claim.

Be careful about ending an injured worker's employment. Under section 248 of the Workers Compensation Act 1987, dismissing a worker because they're not fit for employment as a result of the injury, within 6 months after they first became unfit, is an offence with a maximum penalty of 100 penalty units.

Contractors and deemed workers

Some people are workers in NSW even though they aren't employees. The categories of deemed worker are set out in Schedule 1 of the Workplace Injury Management and Workers Compensation Act 1998, and SIRA publishes a worker or contractor tool to help you work out where someone falls. If you engage labour-only subcontractors, run them through the tool: an ABN alone doesn't make someone a contractor for workers comp.

Sole traders and partners

icare is direct about this: if you're a sole trader, proprietor or member of a partnership, you can't cover yourself with workers compensation insurance. It suggests personal accident and illness cover or income protection instead. If your business is a company and it employs you, talk to icare about how working directors are treated. See insurance for sole traders for the options.

How to take out a policy

New employers can get a quote or apply online through icare's take out a policy page, which it says takes about 10 to 15 minutes. You'll need your ABN, a description of your business activity so the right WIC can be applied, and an estimate of wages for the period. Employers who have held a policy before can also call icare on 13 44 22.

At renewal each year you declare the actual wages you paid, and the premium is adjusted. Lodging that declaration on time matters for small employers, because it is one of the conditions for the Safe Employer Reward.

Workers compensation in other states and territories

Each state and territory runs its own scheme, and an employer registers where its workers are based. If you employ people in more than one state, check each scheme, or compare workers compensation insurance in every state.