Was it a surprise this year when you opened your new Experience Mod Calculation and it was over 1.0? How did this happen??
Your next Mod should never be a surprise,and it is important for you to understand the impact of any loss on the calculation. Since your projects span multiple WC policy years, it’s important to account for any Mod increase so that your bottom line is not affected by a single long-term project.
The following of these steps will have a positive impact on your Mod Calculations and your readiness to handle changes:
1. Review premium and loss data to verify accuracy of the existing EMF
2. Confirm that OCIP/CCIP payroll and claims have been accurately reported
1. Identify claims subject to subrogation and forecast the impact from changes in reserves
2. Determine the impact of medical vs. indemnity claims, control the accuracy of reporting and establish whether any loss control procedures are warranted that may reduce the medical expenses and/or the length of period of indemnity (i.e. return to work procedures)
1. Challenge reserves on open claims in order to reduce any/all claims that may be over reserved
2. Require carrier to file changes with rating bureau
Workers’ Comp premiums can represent 30% to 80% of your total insurance premiums paid, and any surcharge applied will impact your total cost. If the Mod is too high, it can get you thrown off a job or prevent you from being considered for one. Be proactive in the monitoring and management of this critical threat to your company’s cash flow.
Early, Cassidy & Schilling, Inc. can and will support this process so please call us for further information.
Written by Kevin Gass