How Your Experience Mod is Calculated

A company's experience modification rate (EMR) is a number that reflects their history of workers' compensation claims and their safety record. It is used by insurance carriers to calculate the company's workers' compensation premium. Here's a closer look at the formula used to determine a company's experience modification rate:

The Formula for Calculating EMR:

The formula used to calculate a company's experience modification rate (EMR) is based on the following factors:

Actual Losses: The actual losses incurred by the company in the most recent three-year period.

Expected Losses: The expected losses for the industry based on the size of the company and the type of work performed.

Experience Rating Adjustment Factor: This factor adjusts the EMR to reflect the size of the company's payroll and the degree to which it differs from the average payroll for the industry.

The formula for calculating the EMR is:

EMR = Actual Losses / Expected Losses x Experience Rating Adjustment Factor

For example, if a company's actual losses over the most recent three-year period are $100,000, and the expected losses for the industry for that period are $50,000, the company's loss ratio would be 2.0. If the experience rating adjustment factor is 1.0, the company's EMR would be 2.0. This means that the company's workers' compensation premium would be twice the amount of a company with a 1.0 EMR.

To put it simply, an EMR is a number that compares your Workers Comp experience to ‘average.’ A number above 1 is worse than average and a number below 1 is better than average. Your Workers Comp premium is multiplied by that number, so it has a direct effect on the premium you pay. Companies can improve their EMR by implementing safety programs, developing a return-to-work program, reporting claims promptly, and working with a knowledgeable insurance broker. By reducing their actual losses and improving their safety record, companies can reduce their EMR and lower their workers' compensation premiums.

Navigating Workplace Injuries: A Guide for Companies to Respond and Recover

Workplace injuries are unfortunate yet often unavoidable occurrences in the business world. A timely, well-coordinated response to such incidents can minimize their impact and ensure the wellbeing of your employees. Here's a step-by-step guide for companies on handling workplace injuries, from immediate actions to long-term strategies.

Immediate Medical Attention

The first and foremost priority when a workplace injury occurs is the immediate well-being of the injured employee. Ensure that the employee receives prompt medical attention. Depending on the severity of the injury, this could range from administering first aid to calling for an ambulance.

Secure the Area

Once the injured individual is cared for, secure the accident site. This is crucial to prevent any further injuries and to preserve the scene for investigation.

Document the Incident

Accurate documentation is essential when dealing with workplace injuries. Record every detail of the incident, including the date, time, location, people involved, and any witnesses. Capture photographs of the accident scene if possible. This will assist in any subsequent investigations and can be important for insurance claims.

Notify the Relevant Parties

Inform the appropriate parties about the incident as soon as possible. This includes your HR department, management, and your insurance broker or carrier. Depending on your jurisdiction and the nature of the incident, you may also need to report the injury to a local or national health and safety regulator.

Commence Investigation

An internal investigation should begin promptly to understand the cause of the accident. This can help you identify any workplace hazards or operational issues that need to be addressed to prevent similar incidents.

Support Your Employee

Provide ongoing support to your injured employee. This could include assisting with their insurance claim, providing necessary time off, arranging for therapy if needed, and developing a return-to-work plan when they are ready.

Review and Improve Safety Measures

Following the investigation, review your workplace safety protocols. The incident may highlight areas that require improvement. Invest in staff training, update safety equipment, or revise operational procedures as necessary.

Communication

Transparent communication is key following a workplace injury. Keep your employees informed about what happened, how the company responded, and what steps are being taken to prevent similar incidents. This can alleviate anxiety and build trust within your team.

While workplace injuries are challenging, they also provide opportunities for growth and improvement. By handling these incidents with care and efficiency, your company can enhance its safety measures, strengthen its operations, and foster a culture of safety and respect. Remember, your insurance broker is a valuable partner in this journey, providing guidance and support along the way.

Uncomplicating Insurance Claims: Best Practices for a Swift Settlement

As a business owner, encountering situations that necessitate insurance claims is inevitable. Unfortunately, the claim process can sometimes feel daunting and time-consuming. Your commercial insurance is there to protect your business and help it recover quickly, but how can you ensure that your claims get settled promptly and efficiently? Here are some best practices that can help streamline the claim process and get you back to business as soon as possible.

Understand Your Policy

First and foremost, understanding your insurance policy is crucial. You need to know what is covered and what is not. Be familiar with your policy limits, deductibles, and any exclusions. This will prevent surprises when a claim needs to be filed and help you know what to expect from the claim process.

Document Everything

In the event of a claim, having proper documentation is key. This means recording details of the incident as soon as it occurs, taking photographs if possible, and keeping a record of all communication regarding the incident. Documentation can provide clear evidence that supports your claim and speeds up the process.

Notify Your Insurance Broker Promptly

As soon as an incident occurs, notify your insurance broker or provider. Prompt reporting is essential in the claim process. Some insurance policies have strict reporting timelines, and delaying could jeopardize your claim.

Provide Complete and Accurate Information

When submitting a claim, accuracy and completeness are vital. Make sure to provide all the necessary information requested by your insurance provider. Any missing or incorrect information could delay the claim process. Also, be honest. Misrepresenting facts could lead to claim denial or even policy cancellation.

Maintain Open Communication

Maintain open and continuous communication with your broker or adjuster throughout the claim process. Be proactive in following up and clarifying any doubts. This helps ensure everyone is on the same page, which can expedite the claim settlement process.

Implement a Risk Management Plan

While this doesn't directly speed up the claim settlement process, a robust risk management plan can help prevent future incidents. Regular risk assessments, safety protocols, and training can help reduce the number of claims, allowing you to maintain a favorable insurance history. This, in turn, can lead to smoother and quicker claim settlements in the future.

It's true that the insurance claim process can sometimes be complex, however adhering to these best practices can greatly reduce the stress and time involved. The key is preparedness, open communication, and a deep understanding of your insurance policy. Remember, broker is an essential resource in navigating these waters – lean on their expertise, and make the claim process work for your business, not against it.