Terms & Concepts:

Experience Modification Rating

An experience modification rating can either increase or decrease an employer’s workers compensation cost. All new employers begins with an experience mod of 1 and based on the frequency and severity of claims the number will either increase or decrease based on how their results compare to their peers in the same industry and classification. Not everyone will qualify for a EMR, it will depending on the state they operate in and if they maintain enough payroll over a set period of years.

Example: An employer’s workers compensation policy has a base rate of $10,000 and it is multiplied by a 0.90% mod, the premium will now be $9,000 before the additional charges are added such as for terrorism, catastrophe, expense constant, etc.

Employers can work to improve their experience modification factor by making investments into safety, training, and developing a Return to Work program.