1. For Illustrative Purposes Only – Based on 2014 Premium Rates within Proposed Preliminary Rate Framework Rate Framework Reform Presentation on Rate Group 261 Plastic Film and Sheeting

2. For Illustrative Purposes Only – Based on 2014 Premium Rates within Proposed Preliminary Rate Framework Illustrative Example Rate Group 261 – Proposed Preliminary Rate Framework ■The following information is provided to demonstrate an illustrative example for Rate Group 261 Plastic Film and Sheeting within the proposed preliminary Rate Framework. ■The proposed preliminary Rate Framework is a plausible working model that utilizes sufficient data to be able to: –identify how employers would be classified in the 22 industry classes contained in the proposed classification structure; and –provide an illustrative example of potential premium rates to employers from a premium rate perspective. ■The working model reflects the proposed preliminary Rate Framework as though it had been implemented in 2014, considering relevant data for the period 2007- 2012. See Appendix A for the underlying assumptions. 2

3. For Illustrative Purposes Only – Based on 2014 Premium Rates within Proposed Preliminary Rate Framework North American Industry Classification System (NAICS) - Adaptation 3  The proposed classification structure, while using a lettering system to align with legislative provisions, is mapped to the NAICS numbering system.  The accompanying chart identifies the correspondence between the WSIB’s proposed classification structure and the 2 or 3-digit level found in NAICS. Proposed Classification Structure NAICS Equivalent APrimary Resource Industries11-21 BUtilities22 CPublic Administration91 DFood, Textile, and Related Manufacturing31 EResource and Related Manufacturing32 FMachinery and Related Manufacturing33 G1Building Construction236 G2Infrastructure Construction237 G3Specialty Trades Construction238 HWholesale Trade41 IGeneral Retail44 JSpecialized Retail and Department Stores45 KTransportation and Warehousing48-49 LInformation and Culture51 MFinance52-53-55 NProfessional, Scientific and Technical54 OAdministrative, Waste and Remediation56 PHospitals622 QHealth and Social Services621-623-624 RLeisure and Hospitality71-72 SOther Services81 TEducation61 NAICS Hierarchy Industry sectors (two-digit codes)Industry subsectors (three-digit codes)Industry groups (four-digit codes)Industries (five-digit codes)Canadian industries (six-digit codes)

4. For Illustrative Purposes Only – Based on 2014 Premium Rates within Proposed Preliminary Rate Framework How Could RG 261 Employers be Classified? 4  The chart below outlines the classes that employers in RG 261 would be allocated to under the proposed model:  On the next slide, the charts will demonstrate Employer Target and Actual Premium Rates for employers in Classes D, E and RG 261, based on the 2014 premium rates used in the proposed preliminary Rate Framework and using the underlying assumptions identified in Appendix A.  Key Definitions: Class Target Premium Rate is a premium rate based on the valuation of collective liabilities of new claim costs for the employers within a respective class, their allocation of administrative costs, and apportionment of the past claims costs for a particular class. Employer Target Premium Rate is an adjusted premium rate that represents how much an employer needs to pay in order to fund their fair share of costs, as well as the collective costs of their class. Employer Actual Premium Rate is an adjusted premium rate that represents how much each employer would pay taking into consideration risk band limitations, previous year(s) premium rates, minimum premium rate, as well as the collective experience of all employers in that class. For the purpose of this analysis, this is represented as a premium rate for 2014, (considering the relevant data from 2007-2012). Proposed Classification Structure Number of Employers 2013 Insurable Earnings ($B) % of Employers % of Insurable Earnings D - Food, Textile and Related Manufacturing 200.09 32.8%41.4% E - Resource and Related Manufacturing 410.12 67.2%58.6% Total 200.09 32.8%41.4%

5. For Illustrative Purposes Only – Based on 2014 Premium Rates within Proposed Preliminary Rate Framework What Could the Premium Rates look like? 5  The chart below represents the ranges of Employer Target Premium Rates for employers in Classes D, E and RG 261, based on the 2014 premium rates used in the proposed preliminary Rate Framework and using the underlying assumptions identified in Appendix A.  The chart below represents the ranges of Employer Actual Premium Rates for employers in Classes D, E and RG 261, using the same methodology. Employer Target Rate Range (D) $0.20 Minimum Band $1.07 Risk Band Range (79 Risk Bands) Employer Target Premium Rate $10.13 Highest Band Class D - Food, Textile and Related Manufacturing Class Target Premium Rate ($) 3.08 Employer Target Rate Range (E) $0.20 Minimum Band Risk Band Range (81 Risk Bands) Employer Target Premium Rate $10.98 Highest Band Class E - Resource and Related Manufacturing Class Target Premium Rate ($) 3.30 Employer Actual Rate Range (D) $0.20 Minimum Band $0.27 Risk Band Range (80 Risk Bands) Employer Actual Premium Rate $10.60 Highest Band Class D - Food, Textile and Related Manufacturing Class Target Premium Rate ($) 3.08 Employer Actual Rate Range (E) $0.20 Minimum Band $0.50 Risk Band Range (83 Risk Bands) Employer Actual Premium Rate $12.48 Highest Band Class E - Resource and Related Manufacturing Class Target Premium Rate ($) 3.30 $7.17 Employer Actual Rate Range (RG261) $2.56 $3.67 $10.13 $0.73 $10.98 Employer Target Rate Range (RG261) $2.68 $6.84 $12.48 Employer Actual Rate Range (RG261) $2.81 $4.00 Employer Target Rate Range (RG261) Employer Target Rate Range (RG261) $2.24 $7.40

6. For Illustrative Purposes Only – Based on 2014 Premium Rates within Proposed Preliminary Rate Framework Risk Band Analysis 6

7. For Illustrative Purposes Only – Based on 2014 Premium Rates within Proposed Preliminary Rate Framework ■The chart below outlines possible risk bands for employers in RG 261 who will be moving to Class D - Food, Textile and Related Manufacturing, by showing the number and percentage of employers and their actual risk band premium rate. This risk band distribution is subject to change if there are amendments, such as splitting up the classes. 7 D - Food, Textile and Related Manufacturing - RG 261: 2014 Employer Actual Rate – Subject to Transition Plan* 100.0% 0.0% * While the above charts outline the impact to employers considering a +/- 3 risk band limitation scenario that incorporates their Starting Point, these results may be different once a final transition plan (that has received stakeholder input) has been developed to transition employers from the current approach to setting and classifying rates under the proposed preliminary Rate Framework scheme. Overview of Analysis:  About 100.0% of employers will see a lower premium rate when compared to the average risk band rate.  No employers will pay the average risk band rate.  No employers will see a higher premium rate when compared to the average risk band rate. How Could RG 261 Employers be Risk Banded? Lowest Band Risk Bands Highest Band Risk Band Movement from Class Premium Rate (Risk Band 0) -9<-3-3-2 Average 0 123>3-2Total Risk Band Rate$2.56 -$3.48$3.67$3.86$4.06$4.27$4.48$4.70-$3.67 # of Employers127104000000441 % of Employers 65.85%24.39%9.76%0.00%0.0% 100.0%

8. For Illustrative Purposes Only – Based on 2014 Premium Rates within Proposed Preliminary Rate Framework 8 How Could RG 261 Employers be Risk Banded? E - Resource and Related Manufacturing - RG 261: 2014 Employer Actual Rate – Subject to Transition Plan* 90.0% 5.0% * While the above charts outline the impact to employers considering a +/- 3 risk band limitation scenario that incorporates their Starting Point, these results may be different once a final transition plan (that has received stakeholder input) has been developed to transition employers from the current approach to setting and classifying rates under the proposed preliminary Rate Framework scheme. Overview of Analysis:  About 90.0% of employers will see a lower premium rate when compared to the average risk band rate.  About 5.0% of employers will pay the average risk band premium rate.  About 5.0% of employers will see a higher premium rate when compared to the average risk band rate. ■The chart below outlines possible risk bands for employers in RG 261 who will be moving to Class E - Resource and Related Manufacturing, by showing the number and percentage of employers and their actual risk band premium rate. This risk band distribution is subject to change if there are amendments, such as splitting up the classes. Lowest Band Risk Bands Highest Band Risk Band Movement from Class Premium Rate (Risk Band 0) -4<-3-3-2 Average 0 123>33Total Risk Band Rate$2.81 -$2.96$3.11$3.28$3.45$3.62$3.80$4.00- # of Employers7764110010120 % of Employers 35.0%30.0%20.0%5.0% 0.0% 5.0%0.0% 100.0%

9. For Illustrative Purposes Only – Based on 2014 Premium Rates within Proposed Preliminary Rate Framework Summary of Risk Band Movement ■The charts below demonstrate a significant level of stability by showing the year over year risk band movement, as though the proposed preliminary Rate Framework had been in place (without the effect of the 3 risk band limitation), focusing specifically at years 2007 to 2013, to show a summary of: –All the employers who are in RG 261 –The proposed class structure including RG 261 9 * in 2012 and in 2013 Org % with band movement -3 to 3 RG2007 to 20082008 to 20092009 to 20102010 to 20112011 to 20122012 to 2013 Active orgs* 26181.82%92.31%90.91%85.71%91.67%85.48%62 Org % with band movement -3 to 3 ClassClass Description2007 to 20082008 to 20092009 to 20102010 to 20112011 to 20122012 to 2013 Total Active orgs in class* Active orgs in RG 261* % of RG 261 to class DFood, Textile and Related Manufacturing94.73%94.34%95.07%94.56%93.56%92.37%2,635190.72% EResource and Related Manufacturing93.77%93.52%93.61%93.58%93.57%93.24%4,568 43 0.94% Total 7,20362

10. For Illustrative Purposes Only – Based on 2014 Premium Rates within Proposed Preliminary Rate Framework Target Premium Rates 10

11. Current State Analysis: Class and Rate Group Level Target Premium Rates  The WSIB has developed the related class-level and rate group level target premium rates under the Current State, based on the 2014 premium rates and using the underlying assumptions identified in Appendix A.  Other possible considerations or approaches could be considered and could result in very different class-level target rates. In considering this information, it is important to recognize that the composition of the current Rate Groups differs from the modernized NAICS-based classification structure, making for a difficult comparison. 11 Net Rate - represents the premium for respective industries, considering:  RG rate freeze from 2013 published rates  2014 ER adjustments Target Rate - represents the target premium for respective industries, considering:  adjusted NCC to reflect actual experience  balance to Schedule 1 rates of $2.46 and $1.56 For Illustrative Purposes Only – Based on 2014 Premium Rates within Proposed Preliminary Rate Framework Industry Class 2014 Net Rate A – Forest Products4.93 B – Mining and Related6.28 C – Other Primary Industries4.04 D - Manufacturing2.49 E – Transportation and Storage4.83 F – Retail and Wholesale Trades1.75 G – Construction6.36 H – Government and Related1.33 I – Other Services1.27 Schedule 12.46 2014 Target Rate ($10B UFL)($0 UFL) 5.793.60 4.903.13 4.702.95 2.991.88 4.532.79 1.651.08 5.523.41 1.430.93 1.250.81 2.461.56 The next slide shows at the Rate Group level, the: -Net Rate at $10B UFL; -Target Rate at the $10B; and -$0B in UFL.

12. For Illustrative Purposes Only – Based on 2014 Premium Rates within Proposed Preliminary Rate Framework Current State Analysis: Class and Rate Group Level Target Premium Rates 12 Net Rate - represents the premium for respective industries, considering:  RG rate freeze from 2013 published rates  2014 ER adjustments Target Rate - represents the target premium for respective industries, considering:  adjusted NCC to reflect actual experience  balance to Schedule 1 rates of $2.46 and $1.56 2014 Rate Group Net & Target Rate Rate Group Net Rate ($10B UFL) Target Rate ($10B UFL) Target Rate ($0B UFL) Rate Group Net Rate ($10B UFL) Target Rate ($10B UFL) Target Rate ($0B UFL) Rate Group Net Rate ($10B UFL) Target Rate ($10B UFL) Target Rate ($0B UFL) 2074.783.782.363382.672.381.554213.384.933.05 2104.073.202.013413.244.232.664243.224.042.51 2142.403.141.983522.003.512.234253.952.751.75 2162.072.371.523584.736.483.974284.688.415.13 2203.523.242.043613.114.082.544324.035.483.38 2222.731.581.043743.643.682.304422.722.381.52 2232.582.621.673754.725.073.134603.233.662.29 2261.562.121.373774.074.282.664662.373.011.90 2301.621.260.853792.882.331.504680.340.390.27 2312.973.222.023822.142.581.644771.362.011.30 2384.425.643.473832.723.702.314854.875.323.28 2583.534.062.533852.863.592.254965.095.733.53 2612.432.571.643873.344.042.514973.514.092.56 2633.013.672.303892.454.923.045013.073.081.94 2893.703.622.263903.576.223.825023.344.292.67 3012.412.981.883933.423.922.445070.811.621.07 3085.364.672.894022.152.731.735121.662.531.61 3114.014.392.734031.632.221.435140.731.130.77 3127.267.214.414062.643.111.965171.411.621.07 3223.385.513.404082.332.531.615241.78 1.16 3232.112.431.554112.903.622.265290.970.980.67 3254.194.612.864171.571.511.005332.952.821.79 3284.394.903.034194.304.282.665384.163.222.02 3331.572.051.354201.162.851.815421.982.211.42 3350.540.760.52

13. For Illustrative Purposes Only – Based on 2014 Premium Rates within Proposed Preliminary Rate Framework 13 Proposed Preliminary Rate Framework: Class Level Target Premium Rates and Risk Band Ranges  The WSIB has developed the related class-level target premium rates and the risk band range for each class under the proposed preliminary Rate Framework, based on the 2014 premium rates used in the proposed preliminary Rate Framework and using the underlying assumptions identified in Appendix A. Class Premium Rates with $10 UFLClass Premium Rates with $0 UFL Class Letter Class Description Class Target Premium Rate ($) Employer Target Premium Rate Class Target Premium Rate ($) Employer Target Premium Rate Risk Band Range ($) Minimum Band Highest Band # of Risk Bands Minimum Band Highest Band # of Risk Bands APrimary Resource Industries4.680.2414.94832.930.159.27 83 BUtilities1.060.203.44580.730.152.37 56 CPublic Administration3.860.2012.05802.400.157.50 79 DFood, Textile, & Related Manufacturing3.080.2010.13791.930.156.33 75 EResource and Related Manufacturing3.300.2010.98812.060.156.82 77 FMachinery and Related Manufacturing3.200.209.82792.000.156.13 75 G1Building Construction5.220.2616.64833.210.1610.22 83 G2Infrastructure Construction4.870.2415.50833.000.159.55 83 G3Specialty Trades Construction4.570.2314.35832.820.158.83 82 HWholesale Trade1.730.205.49671.130.153.59 64 IGeneral Retail1.660.204.91651.090.153.23 62 JSpecialized Retail & Department Stores1.460.204.34630.970.152.88 60 KTransportation and Warehousing4.260.2213.98832.640.158.59 81 LInformation and Culture0.610.202.09480.420.151.44 46 MFinance1.370.204.50630.910.152.97 60 NProfessional, Scientific and Technical0.550.202.06480.380.151.42 46 OAdministrative, Waste & Remediation2.590.208.39751.640.155.27 72 PHospitals1.130.203.67590.770.152.50 57 QHealth and Social Services2.280.206.86721.460.154.41 68 RLeisure and Hospitality1.900.205.75681.230.153.73 65 SOther Services2.430.207.71741.540.154.88 70 TEducation0.430.201.37400.300.150.96 38 Schedule 12.46 1,5341.56 1,482

14. For Illustrative Purposes Only – Based on 2014 Premium Rates within Proposed Preliminary Rate Framework Appendix A 14

15. For Illustrative Purposes Only – Based on 2014 Premium Rates within Proposed Preliminary Rate Framework Underlying Assumptions ■The working model reflects the proposed preliminary Rate Framework as though it had been implemented in 2014, considering relevant data for the period 2007- 2012.  To develop this version of target premium rates, the WSIB considered the following: –Adjusted NCC by industry class in line with their claims experience; –Allocation of the administrative costs, using the current method, but factoring adjusted NCC; –Apportionment of the UFL utilizing the former NCC methodology, but factoring adjusted NCC; –Two UFL scenarios (1) Dec 2013 – approximately $10B and (2) with No UFL; and –Revenue neutrality, balancing class-level target rates to $2.46 and $1.56, per the UFL scenarios, where only the value of the UFL ($0.90) represents the variance. 15