Unlocking the Secret to Lowering Your Experience Modification Factor

Getting your Experience Modification Factor takes patience. It does not happen overnight. In fact, because your "e-mod" is calculated based on several years of data, it can easily take two or more years to begin to see it drop.

Typically, our strategy is to begin holding quarterly meetings with our client to review all claims.

We coach our client on the importance of prompt claims reporting. We also help our clients understand that it is in their best interest to be thorough in helping the insurer gather the facts on a claim. In other words, our client has to become a partner in investigating claims with the insurer.

Here are four more important items you’ll want to consider to help regain control of your Experience Modification Factor:

  1. If you’re in the construction business – or any business, really – it’s a good idea to start by checking your e-mod score to understand why it is what it is. You’ll want to ask about the data used to calculate your e-mod and whether it is up-to-date and correct. Don’t assume your current insurance brokerage is doing this for you.
  2. You’ll want to be sure you have a sound safety program in place. This includes providing new employee orientations, refresher training, and remedial training as needed. Also, report injuries early, make sure to maintain safety training records for OSHA reporting, and investigate accidents and near-misses.
  3. You’ll need a return-to-work plan. One of the best ways to help an injured employee recover, and to keep your claim costs down, is to offer them modified work tasks. Modified duty may include modifying a worker’s essential tasks, changing work conditions or physically modifying the workplace.
  4. Double-check what the insurance company is telling NCCI about your claim. Insurers will set up a reserve to pay for a claim and will often submit that amount to NCCI rather than the actual, possibly lower amount required to resolve a claim. That can end up causing your e-mod to go up more than it should.

The Mahoney Group, based in Mesa, Ariz., is one of the largest independent insurance and employee benefits brokerages in the U.S. An employee-owned organization, we’ve been providing our clients with the confidence to face whatever lies ahead for more than 100 years. For more information, contact us online or call 877-440-3304.

This article is not intended to be exhaustive, nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel or an insurance professional for appropriate advice.

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