Benchmark Methodology
How the Pembroke EstimateIQ benchmark is calculated, which data sources are used, and what the model does and does not account for.
What this benchmark is — and isn't
The Pembroke EstimateIQ benchmark is a directional range showing what businesses with a similar profile commonly pay for commercial insurance. It is calculated from published industry data and regulatory filings, adjusted for industry, size, operating history, and coverage type.
It is not a rating engine, not a quote, and not a binding offer of coverage. Your actual premium will be determined by underwriting review, full application, carrier appetite, specific location, claims history, and factors that a benchmark tool cannot capture. A licensed Pembroke advisor will provide real carrier pricing based on your complete application.
Primary data sources
The benchmark draws on three categories of published data:
For workers compensation benchmarking, the primary source is the Workers' Compensation Insurance Rating Bureau of California (WCIRB). California is one of a handful of states with an independent workers' comp bureau — NCCI (the National Council on Compensation Insurance) does not operate in California and should not be cited for California workers' comp data.
WCIRB publishes approved advisory pure premium rates by classification code. The current approved rates effective September 1, 2026 average $1.65 per $100 of payroll, a 6.6% increase over the September 1, 2025 rates which averaged $1.52 per $100.
Important disclosure: Pure premium rates exclude insurer administrative costs and overhead. To arrive at the rates employers actually pay, a loss cost multiplier must be applied — commonly in the range of 1.3× to 1.6× depending on the carrier. This multiplier is an assumption of this model, not a filed figure, and it is disclosed here rather than embedded invisibly in the output.
The U.S. Bureau of Labor Statistics QCEW program publishes employment counts and average weekly wages by county, MSA, and state, at 6-digit NAICS industry level. Coverage exceeds 95% of U.S. jobs. Data is updated quarterly and available as CSV for programmatic retrieval.
QCEW is the bridge between an employer's stated employee count and an estimated annual payroll figure — which then multiplies against the WCIRB class rate to produce a workers comp benchmark. Example: "11–25 employees in home health in San Diego County" → QCEW median weekly wage for NAICS 621610 → estimated annual payroll → × WCIRB rate for class 8835 → × loss cost multiplier.
BLS data is public domain, federally produced, and citable.
For coverage lines other than workers compensation (general liability, professional liability, cyber, commercial property, D&O), the benchmark model uses relative industry factors drawn from published loss ratio data, market surveys, and rate-level analyses publicly available from insurance regulators and industry associations.
These factors represent the relative cost relationship between industries — for example, that senior care liability typically costs more than small business retail liability. They are not carrier-specific filed rates.
Model inputs and how they affect the range
- Industry / business type — the single largest factor. Sets the base rate level for the output. Workers comp class code and GL hazard group both vary significantly by industry.
- Number of employees — drives estimated payroll, which scales workers comp exposure. Also proxies for business complexity in GL and BOP pricing.
- Annual revenue — used as a secondary size signal, particularly for professional liability and E&O pricing where revenue is often the primary rating basis.
- Years in business — new ventures pay more. Carriers apply a surcharge for businesses under 3 years in operation, tapering off after year 5 in most lines.
- Primary coverage type — the benchmark shifts based on whether you are seeking GL, WC, professional liability, or a package. These are priced differently and the output range reflects the requested coverage type.
- Claims history (optional — Screen 5) — the most powerful single downward (no claims) or upward (one or more) modifier. The range noticeably narrows when this is answered because it eliminates the largest source of pricing variance.
- State (optional — Screen 5) — regulatory environment and market competition vary by state. California is the model baseline. States with higher workers comp or liability costs (e.g. New York) carry upward adjustments; lower-cost states (e.g. Texas, Arizona) carry downward adjustments.
Why ranges, not point estimates
Insurance premiums are not deterministic at the profile level. Two businesses in the same industry with the same headcount will receive different offers from the same carrier based on underwriting review, loss history, specific operations, contractual requirements, and risk management practices. Any tool that produces a single number is either over-confident or hiding assumptions.
The Pembroke benchmark produces a range — wider before claims history is entered, narrower after — because that is an honest representation of what the model can and cannot know from six fields. The distribution bar shows where your profile sits relative to a broader market range, not a single prediction.
What the model does not account for
- Specific location (zip code, county, flood zone, seismic zone)
- Individual claims details beyond count
- Carrier-specific underwriting appetite or program availability
- Policy limits and deductible selections
- Contractual requirements from clients, landlords, or lenders
- Endorsements and coverage modifications
- Credit-based insurance scoring (used in some personal lines, increasingly in commercial)
- Mid-term policy changes and audits
- Multi-policy or loyalty discounts
A licensed Pembroke advisor will account for all of the above in producing real carrier options and actual pricing for your business.
Licensing and regulatory notice
Pembroke Insurance is a licensed California insurance broker, CA License #20790267. This benchmark tool is provided for informational purposes only and does not constitute an offer, commitment, or binder of insurance coverage. All coverage is subject to underwriting approval, full application, and carrier acceptance.
This tool does not collect or use personal information to generate a benchmark. State is used only as a pricing adjustment factor. Contact information submitted on Screen 6 is used only to connect you with a Pembroke advisor and is handled per our Privacy Policy.