About 15 percent, or 3,500, of the 22,000 policyholders of the Workmen's Compensation Fund of Utah will lose all or part of a discount on their workmen's compensation insurance premium rates because of their high number of claims, according to Blaine Palmer, fund president.

Alteration of the discount for the 3,500 companies is an alternative to raising premiums caused by dramatic increases in health care costs, Palmer said. The fund ran a deficit the past two years and other cost-saving measures are being implemented in an attempt to save money.Some 8 percent of the companies the fund insures account for 60 percent of the expenditures. These companies represent a variety of industries. Palmer said these companies will lose all of their 25 percent discount until their safety record improves and the number of claims diminishes.

For the other 7 percent, the discounts will be lowered, depending on the number of claims they have. The "rate alteration" will be effective July 1.

The state insurance commissioner annually establishes rates for workmen's compensation insurers. Palmer said the WCF practice has been to discount those rates by 25 percent for all its policyholders regardless of the number of claims against the fund.

But the board of directors decided it's time to make the fund "claim driven" and provide more incentive to reduce accidents and claims. Palmer said the rate adjustment program was based upon each employer's claim history in the past three years.

Palmer said 85 percent of the 22,000 companies the fund insures won't lose their 25 percent discount. Those policyholders losing or having their discounts reduced in July will receive discounts when their number of claims decreases.