Your Experience Mod Is Your Longmont Workers’ Comp Identity

Longmont Artisan Contractors Insurance
February 18, 2016
How Surety Bonds Are Different Than Insurance
March 31, 2016
Show all

Your Experience Mod Is Your Longmont Workers’ Comp Identity

worker1-portfolioIt is a fact that many employers actually overpay for their Longmont workers’ compensation premiums.  According to the latest reports, employers are paying around 20% more in surcharges than they need to. Most surcharges come from increases in the experience modification factor (mod).

The experience mod is a factor unique to each employer. In simple terms, this formula is designed to compare a specific employer’s historical claim and payroll data, to other employers with similar business operations. An individual employer’s experience mod is calculated using claims data compared to premiums from the three most recently completed years, excluding the expiring term.

Key points to consider

  • If your losses are increasing, your mod most likely will go up even if your payroll goes down.
  • The frequency of losses hurt you more than the severity of losses.
  • It is important to check the calculations on the experience modification worksheet each year.
  • The most common errors are incorrect or incomplete payroll data.
  • Your workers’ compensation mod is the single most important factor insurers use to identify your risk.
  • Your mod can be reduced through effective safety and loss control programs.

How to reduce your mod?

  • Develop a safety program.
  • Reward safety in the workplace.
  • Start a return to work program.
  • Complete regular safety inspections.
  • Investigate every accident and make corrective actions if needed.
  • If you suspect fraud, immediately inform the insurance company.
  • A disciplinary program also should be incorporated into the safety program; it should hold employees accountable for breaking the rules.

For over 10 years, we have focused on reducing insurance costs and improving coverage for Colorado contractors which make up over 80% of our current clientele.  In fact, Steve has studied to be a CRIS (Contractor Risk Insurance Specialist) agent, a very rare and difficult certificate to achieve.  Since he knows all the details of contractor’s risks, you are in good hands with Steve!  Coverage for contractors include Commercial Auto, General Liability, Inland Marine, Property, Workers Compensation and more.

Leave a Reply

Your email address will not be published. Required fields are marked *